In July 2026, retail sales of passenger cars in China decreased by 21.1% year-on-year to 1.47 million units. This marks the tenth consecutive month of decline. From January to July, the domestic market shrank by 20.5%.
Against this backdrop, exports show the opposite trend. In July, Chinese automakers shipped 923,000 cars abroad, an 88.2% increase compared to the previous year. Deliveries of electric vehicles and plug-in hybrids are growing particularly fast – by 147.8%.
The reason is not only weak demand. The Chinese market has become overloaded with models, and constant updates and price competition force buyers to choose cars more carefully. Manufacturers, on the other hand, continue to maintain high production volumes.
As a result, exports are becoming a way to load factories and compensate for falling domestic sales. Chinese brands are actively expanding in Europe, Southeast Asia, Latin America, and the Middle East. However, abroad they have to compete not only with local brands but also among themselves.
The gap between domestic and foreign demand is particularly striking: sales of electric vehicles and plug-in hybrids in China decreased by 3.9%, while their exports grew almost 2.5 times.