Sales of Chinese-made vehicles, including exports, declined by 3.2% to 2.346 million units in January 2026 from 2.420 million units a year earlier, according to passenger car and commercial vehicle wholesale data compiled by the China Association of Automobile Manufacturers (CAAM). Domestic sales declined by almost 16% to 1.665 million units last month from 1,950 million units a year earlier, while exports surged by over 45% to 681,000 units. Vehicle production in the country was slightly higher at 2.450 million units.
With this year’s Lunar New Year holidays falling in February, China’s vehicle market failed to benefit from more working days last month compared with last year. Many buyers rushed into the market at the end of last year ahead of the expected reductions in government incentives, before the full purchase tax exemption on NEVs transitioned to a 50% discount in January, while trade-in incentives have also been reduced.
More recently, measures have been announced to end the prolonged “race-to-the-bottom” price war among domestic manufacturers, which is seen as damaging to the industry’s long-term growth prospects. The Chinese government announced it will no longer allow automakers to sell their vehicles at below the cost of production.
Sales of Chinese-made new energy vehicles (NEVs), comprising mainly battery-powered and plug-in hybrid vehicles, increased just slightly to 945,000 units last month. Domestic sales fell by 19% year-on-year to 643,000 units, while exports doubled to 302,000 units.
Following last year’s strong growth, combined with reduced government incentives and the newly introduced price controls, the Chinese domestic vehicle market looks somewhat saturated, while consumer sentiment in the country also remains cautious. China’s economy expanded by a slower-than-expected 4.5% year-on-year in the fourth quarter of 2025, slowing from 4.8% in the third quarter, reflecting sluggish consumer spending and weak fixed investment.
GlobalData is forecasting just a slight rise in light vehicle sales in the country to 27.3 million units in 2026, from 26.9 million in 2025.
Manufacturer performances
SAIC Motor regained its crown as China’s largest vehicle producer in January 2026 with global sales rising by 24% to 327,413units, driven by a 40% rise in NEV sales to 85,374 units. SAIC-GM-Wuling reported a 37% rise in global deliveries to 105,477 units, while SAIC-VW’s sales fell by 9% to 68,402 units. SAIC-GM’s sales continued to rebound last month, by 29% to 43,502 units, while the group’s SAIC Motor passenger vehicle unit reported a 51% sales increase to 77,421 units. The group’s overseas sales surged by 52% to 104,529 units.
Geely Auto, excluding key overseas subsidiaries and joint ventures including Volvo, Polestar and Proton, reported a 1.3% rise in global sales to 270,167 units last year, despite a 15% drop in BEV sales to 68,012 units. Exports surged by 121% to 60,506 units, while its Zeekr unit saw its global sales almost double to 23,852 units.
BYD reported that itsglobal sales plunged by 30% year-on-year to 210,051 units in January, following a 49% surge to 300,538 units a year earlier, with exports dropping by 51% to 100,482 units. Overall passenger battery electric vehicles (BEVs) dropped by 34% to 83,249 units, while sales of passenger plug-in hybrid electric vehicles (PHEVs) fell by 29% to 122,269 units and commercial NEV sales increased by 11% to 4,533 units.
Chery Automobile’s global sales declined by 11% to 200,269 vehicles in January, following a sharp fall in domestic sales, while exports surged by 48% to 119,605 units – cementing its position as the country’s largest vehicle exporter. Changan Auto sales plunged by 51% to 134,700 units, while GAC Group, including its joint ventures with Toyota and Honda, reported an 18% increase in global sales 116,622 units. Great Wall Motor’s sales increased by almost 12% to 90,312 units, with overseas sales rising by 44% to 40,278 units.
Tesla’s Shanghaifactory sales increased by 9% to 69,129 unitslast month, reflecting a 71% surge in exports to 50,644 units while retail sales in China fell by 45% to 18,485 units.
