China's passenger vehicle market hits all-time high in annual output, wholesales, exports

Shanghai (Gasgoo)- China's passenger vehicle (PV) market saw robust performance in December 2024, with retail sales reaching 2.635 million units in the domestic region, up 12% year-on-year and 8.7% month-on-month, according to data from the China Passenger Car Association ("CPCA").

Cumulative PV retail sales for the year reached 22.894 million units, marking a 5.5% increase from the previous year.

For clarity, the PVs hereby refer to cars, MPVs, and SUVs locally produced on the Chinese Mainland.

China's PV market began with strong momentum in December 2024, fueled by automakers intensifying efforts to meet annual sales targets. The approaching expiration of "two new" subsidies (trade-in and scrappage incentives) at year-end spurred significant demand. Additionally, the earlier-than-usual Chinese New Year in late January 2025 prompted some consumers to bring forward their purchases to December, although certain regions exhausted subsidy funds, slowing sales in the latter half of the month. These factors collectively contributed to the robust release of car-buying demand in December.

Key Highlights of the 2024 PV Market

(1) Record-high production, wholesale, and exports: Although 2024's retail sales remained nearly 1 million units below the 2017 peak, the PV market holds substantial potential for growth in 2025.

(2) Dominance of China's self-owned brands: China's self-owned brands reached a wholesale market share of over 65% and a retail share topping 60%, a 9-percentage-point increase from the previous year. This reflects their innovations in product strength and channel management, which have garnered strong consumer support.

(3) Stabilized price competition: The frequency of price cuts and promotions eased in the second half of the year, maintaining a steady promotional level in the fourth quarter.

(4) Rapid growth in exports: Full-year PV exports reached around 4.8 million units, jumping 25% year-on-year. However, export growth slowed to 8% in the fourth quarter.

(5) Inventory reduction: Last year, China's PV makers reduced inventory by 340,000 vehicles and channel inventory was decreased by 490,000 vehicles. The instability in the traditional oil-fueled vehicle distribution system contributed to significant inventory adjustments.

(6) Surging new energy vehicle (NEV) Sales: Retail NEV sales reached 10.899 million units in China's domestic market, with a net increase of 3.154 million units, surging 41% year-on-year—5 percentage points higher than in 2023. The annual penetration rate for NEVs reached 47.6%, up 12 percentage points over a year ago, with rates exceeding 50% for five consecutive months in the second half of the year.

(7) Growing NEV wholesales and exports: China's NEV wholesale volumes hit 12.23 million vehicles in 2024, with a net increase of 3.356 million units from the year-ago period, leaping 38% year-on-year. The NEV penetration rate by wholesales reached 45%, up 10 percentage points. NEV exports had a penetration rate of 27%, signaling significant potential for global market expansion.

In December 2024, China's wholly-owned PV brands posted retail sales of 1.64 million units, a year-on-year jump of 32% and a month-on-month rise of 5%. These brands achieved a domestic retail market share of 62.3%, up 9.3 percentage points year-on-year.

For the full year, China's self-owned PV brands captured a 61% share, an 8.6 percentage point increase from 2023.

Major legacy automakers such as BYD, Chery Auto, Geely Auto, and SAIC-GM-Wuling ("SGMW") demonstrated outstanding transformation and growth, significantly increasing their market shares.

On the list of top 10 automakers by annual PV retail sales, BYD outsold others with a retail volume of 3.718 units, while Chery Auto was honored the fastest-growing one with a year-on-year surge of 64.6%.

Mainstream joint ventures reported retail sales of 710,000 vehicles in December 2024, a year-on-year decline of 11%, though up 17% month-on-month. German brands held a market share of 16.2%, down 4.4 percentage points year-on-year, while Japanese brands accounted for 13.4%, a 3.6-percentage-point drop. American brands maintained a retail share of 6.7%, a slight dip of 0.1 percentage points year-on-year.

Premium PV sales amounted to 290,000 units in December last year, an 8% year-on-year decrease, but a 10% month-on-month improvement. The premium car segment's market share fell to 10.9%, down 2.5 percentage points from last year.

China’s PV wholesale sales reached 3.075 million units last month, up 12.3% year-on-year and 4.5% month-on-month, marking an all-time high on a monthly basis. Cumulative PV wholesale sales for 2024, including domestic market sales and exports, totaled 27.191 million units, a 6.3% increase from 2023.

China’s self-owned brands led the wholesale market with a volume of 2.028 million units in last December, up 28% year-on-year and 1% month-on-month. However, joint-venture brands struggled, with a wholesale volume of 728,000 units, down 10% year-on-year, but up 12% month-on-month. Premium PV wholesale volume also declined by 7% year-on-year, but rose 13% month-on-month, reaching 318,000 units.

In December 2024, wholesale performance among major PV manufacturers varied significantly. Chery Auto, Great Wall Motor, and GAC AION demonstrated strong year-on-year and month-on-month growth. A total of nine PV makers in China achieved monthly wholesale sales exceeding 100,000 units, up from eight in November and on par with December 2023. These nine companies accounted for 59% of the total market share. Among the 36 manufacturers with wholesale sales exceeding 10,000 units, 27 reported month-on-month growth, with 14 recording increases of over 10%. NEV startups and joint ventures posted particularly strong growth, while major indigenous legacy manufacturers saw slight contractions.

Regarding the full-year wholesale performance, there were seven PV makers in China surpassing the 1-million-unit mark, among which the top four automakers, namely, BYD, Chery Auto, Geely Auto, and Changan Auto all gained a year-on-year upward movement.

PV production in December 2024 reached 2.941 million units, a 9.7% year-on-year increase but a 2.7% decline from the previous month. This figure exceeds the December 2023 peak of 2.67 million units by 270,000 units.

To be specific, premium PV production dropped 20% year-on-year and 12% month-on-month, while joint-venture brands saw production fall 17% year-on-year and 5% month-on-month. In contrast, China's self-owned brands recorded a 29% year-on-year increase in December output, despite a slight 1% month-on-month dip.

New energy passenger vehicle (NEPV) production in December 2024 reached 1.455 million units, a 32.2% year-on-year jump, although 2% lower than November. For the full year, China's NEPV production totaled 12.185 million units, marking a 36.4% year-on-year leap.

China's NEPV wholesale sales hit 1.512 million units last month, a 35.6% year-on-year increase and a 5% rise month-on-month. NEPV retail sales reached 1.302 million units in the same month, up 37.5% year-on-year and 2.6% month-on-month. Meanwhile, NEPV exports surged to 122,000 units, representing a 21.5% year-on-year increase and a 52.9% month-on-month spike.

For the full-year performance in 2024, the country's NEPV wholesale sales totaled 12.23 million units, retail sales reached 10.899 million units, and exports amounted to 1.29 million units, reflecting year-on-year growth rates of 37.8%, 40.7%, and 24.3%, respectively.