Sales trends and hot spots of China's automobile market from January to June 2024

In the first half of 2024, China's auto market sales reached 14.047 million units, a year-on-year increase of 6.1%, and the overall market sales continued to grow. From January to June, China's auto exports contributed a lot of growth, but the growth rate slowed down significantly.

Sales Trend Analysis

Overall market overview: a year-on-year increase of 6.1%. In the first half of 2024, China's auto market sold 14.047 million vehicles, a year-on-year increase of 6.1%. Thanks to the implementation of policies such as old-for-new and NEV going to the countryside, coupled with the continued growth of export sales, the cumulative sales in the first half of the year hit a record high for the same period.

Passenger car market: a year-on-year increase of 6.3%. In the first half of the year, the passenger car market sold 11.979 million vehicles, a year-on-year increase of 6.3%, of which the growth rate in the second quarter fell sharply. In terms of demand, the strong promotion efforts of car companies in the first quarter released some car purchase demand in advance, resulting in a significant slowdown in the overall growth rate in the second quarter.

Passenger car category dimension: SUV share further expanded compared with the same period in 2023. SUV share was 53.5%, an increase of 2.6 percentage points year-on-year, and all levels achieved significant year-on-year growth. In the A0 class, Binyue, Yuan UP, and other models contributed to the main growth; some ICE models in the A and B classes grew at a high rate year-on-year; in the C class, the sales of the M9 and M7 reached 165,000 units, and the sales of the Ideal L series models exceeded 180,000 units.

New energy vehicle market: a year-on-year increase of 32%. In the first half of the year, a total of 4.944 million new energy vehicles were sold, a year-on-year increase of 32%. From the perspective of penetration rate, the penetration rate of the entire market reached 35.2% in the first half of the year, of which the penetration rate of the passenger car market reached 39.3%.

New energy passenger car market: a year-on-year increase of more than 30%. In the first half of the year, a total of 4.702 million new energy passenger cars were sold, a year-on-year increase of 31.5%. The penetration rate of independent brand NEVs reached 53%, a year-on-year increase of 5.3%. At present, my country's purchase restrictions and new energy license plate policies are gradually being relaxed, which is expected to further drive the increase in NEV penetration.

Market hot spot analysis

The plug-in hybrid market has become the main growth point of the NEV market. In the first half of the year, the cumulative sales of plug-in hybrid passenger cars reached 1.6049 million units, accounting for more than 40% of NEV passenger cars, a year-on-year increase of 77.9%, far exceeding the pure electric models (19.5%). In 2023, the sales of plug-in hybrid models and extended-range models in A-class cars began to exceed those of pure electric models, and the gap widened further in the first half of 2024. Driven by models such as Ideal and Wenjie, the SUV extended-range market also grew significantly. Under the combined effect of the two, the plug-in hybrid market grew by 65.5% year-on-year in the first half of the year, and the extended-range market grew by 119.4% year-on-year.

Gast's opinion: In the first half of the year, various automakers accelerated their layout in the plug-in hybrid and extended-range markets, with an increase in the number of new products launched, and more than 50 new plug-in hybrid/extended-range power models were added, covering all price segments. In addition, the prices of extended-range/plug-in hybrid models have gradually dropped, with plug-in hybrid models entering the 100,000-level and extended-range models entering the 150,000-level, which will further impact the core market of mainstream joint venture car companies.

Export markets face challenges

From January to June, China exported 2.79 million vehicles, maintaining a high year-on-year growth trend. From the perspective of power generation: ICE models have a year-on-year growth rate of 36.2%, which is higher than the overall market; the growth rate of NEV models has slowed down, and the export of pure electric models has declined year-on-year. From the perspective of export regions: Due to the rise of Southeast Asia and the Middle East markets, Asia has overtaken Europe to become the largest continent for China's automobile exports; Brazil has become China's largest NEV exporter, resulting in the largest year-on-year increase in export volume in South America. However, as many regions announced adjustments to tariff rates on Chinese cars in the first half of the year, Chinese car companies will face increasing trade barriers. Compared with the 57.8% year-on-year growth rate of automobile exports in 2023, the year-on-year growth rate in the first half of the year has narrowed significantly, and the total volume of NEV exported to Europe has dropped by 16% year-on-year. The increase in tariffs has caused China's overall export volume growth to slow down.

Guest’s point of view: The impact of current trade tariffs on China’s automobile exports has not yet fully emerged, and it is expected that the negative impact will further expand in the second half of the year. In the short term: the European Union, Turkey, and Brazil are all major exporters of NEV to China, and NEV export volume is expected to continue its downward trend; while independent brands in the United States and Canada have not yet fully entered the market, and the impact is expected to be small. Long-term view: The additional tariffs are expected to reduce China's passenger car exports by 4%.