Strong Growth in China's Automotive Market in 2024: NEVs Dominate the Mainstream [SMM Analysis]

SMM, January 19: According to the latest data released by CAAM, China's automobile market continued to perform strongly in December 2024. Driven by the trade-in policy, market vitality remained robust, and year-end efforts by enterprises to push for targets significantly boosted car purchase demand. This month, automobile production reached 3.366 million units, while sales hit 3.489 million units. Production decreased by 2% MoM, but sales were up 5.2% MoM. YoY growth rates for production and sales were 9.3% and 10.5%, respectively.

In the NEV sector, December's performance was particularly remarkable, with production reaching 1.53 million units and sales hitting 1.596 million units. Although production declined by 2.3% MoM, sales increased by 5.6% MoM. YoY growth rates for production and sales were 30.5% and 34%, respectively. NEV sales accounted for 45.8% of total automobile sales.

Looking ahead to the full year, China's automobile market in 2024 is expected to show steady growth. Annual automobile production totaled 31.282 million units, while sales reached 31.436 million units, up 3.7% and 4.5% YoY, respectively. The NEV sector performed even better, with annual production totaling 12.888 million units and sales reaching 12.866 million units, up 34.4% and 35.5% YoY, respectively. NEV sales accounted for 40.9% of total automobile sales, an increase of 9.3 percentage points from the previous year.

Within the NEV composition, EV sales accounted for 60%, a decrease of 10.4 percentage points compared to 2023. However, the share of plug-in hybrid car sales rose to 40%, with the same increase of 10.4 percentage points. This indicates a gradual expansion of the plug-in hybrid market and a growing trend of diversified consumer preferences.

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NEVs are one of the key end-use sectors for the rare earth permanent magnets industry. Their rapid development has significantly driven the sustained increase in demand for rare earth permanent magnets. In 2024, the NEV sector maintained strong growth momentum. By year-end, while demand growth in most downstream end-use sectors of the rare earth industry slowed, NEV demand for rare earth permanent magnets remained relatively high. By 2025, supported by various favorable policies, the NEV market is expected to continue its rapid growth, thereby sustaining high demand for rare earth permanent magnet materials.