On December 11, Cui Dongshu released an analysis of the November 2025 passenger vehicle market trends. The anti-involution wave is steering the auto market toward a more stable phase, characterized by reduced price cuts and moderated promotions. Official price reductions by automakers or new models breaking below the lowest guidance prices in recent years have declined, but the direct entry of low-priced new models has notably boosted sales.
In November 2025, passenger vehicle retail sales fell by 8%, significantly underperforming the 2% growth in wholesale figures. High interest rates, limited rebates, and paused subsidies contributed to the retail decline from July to November. A-segment sedans and MPVs recorded weak retail sales, while A0-segment sedans and C-segment SUVs emerged as the primary drivers. SUVs showed strong high-end performance, with A0-segment sedans rebounding and A00-segment models performing well.
December is expected to see robust new energy vehicle (NEV) retail sales, driven by the impending expiration of NEV purchase tax exemptions and a 5% tax hike in 2026, heightening year-end purchase urgency. Consumers are prioritizing delivery timelines, prompting automakers to introduce temporary purchase tax subsidies to offset rising costs due to extended delivery cycles.
Consumer sentiment remains heavily influenced by market dynamics, with many opting for readily available models amid long wait times for popular ones, sustaining market momentum and boosting NEV sales. Strong overseas profitability has accelerated exports, with China's auto exports performing exceptionally well in the second half of 2025. NEV recognition abroad is rising, supported by expanding marketing networks.
Parallel export policies are set to take effect, with zero-kilometer used NEVs gaining traction, contrasting with sluggish parallel imports. Domestic automakers have nearly balanced inventory in Russia, easing export pressure to Russia and Central Asia. By 2026, exports to Russia are projected to rebound.
Strong trade-in subsidies, exceeding CNY 180 billion in 2025, and a 10% NEV purchase tax break—covering 22% more sales than 2024—have driven market growth. However, 2026 faces challenges as the NEV tax break drops to 5%, reducing exemptions by over CNY 100 billion.
**Market Segment Performance** 1. **A00-Segment Sedans** - November 2025 wholesale: 171,900 units (13.81% share), down 1% YoY but up 4% MoM. - Retail sales fell 22% YoY and 13% MoM. - Jan-Nov wholesale: 1.5483 million units (+42% YoY); retail: 1.2731 million units (+15% YoY). - Competition resembles the early 2000s, with BYD, Geely, Changan, and Chery leading in compact EV offerings.
2. **A0-Segment Sedans** - November wholesale: 183,500 units (14.75% share), up 25% YoY and 11% MoM. - Retail sales rose 30% YoY and 3% MoM. - Jan-Nov wholesale: 1.4922 million units (+60% YoY); retail: 1.0172 million units (+63% YoY). - EVs are displacing fuel models, shifting dominance from joint ventures to domestic brands.
3. **A0-Segment SUVs** - November wholesale: 203,000 units (12.28% share), down 9% YoY and 7% MoM. - Retail sales dropped 22% YoY and 10% MoM. - Jan-Nov wholesale: 1.9701 million units (-4% YoY); retail: 1.1383 million units (-5% YoY). - Japanese/Korean models have exited, leaving domestic EVs dominant.
**A-Segment Market** 1. **Compact Sedans** - November wholesale: 445,800 units (35.84% share), down 7% YoY but up 3% MoM. - Retail sales fell 16% YoY but rose 2% MoM. - Jan-Nov wholesale: 3.9898 million units (-5% YoY); retail: 3.664 million units (-7% YoY). - NEVs led in 2024, with BYD dominating, while fuel models saw a 2025 rebound.
2. **Compact SUVs** - November wholesale: 880,000 units (53.52% share), down 2% YoY but flat MoM. - Retail sales dropped 16% YoY and 7% MoM. - Jan-Nov wholesale: 8.1086 million units (+15% YoY); retail: 5.761 million units (+9% YoY). - BYD, Geely, Changan, and Chery SUVs are excelling domestically and abroad.
**B-Segment and Above** 1. **B-Segment Sedans** - November wholesale: 380,500 units (30.59% share), up 3% YoY and 5% MoM. - Retail sales fell 9% YoY and 1% MoM. - Jan-Nov wholesale: 3.5712 million units (+7% YoY); retail: 3.2968 million units (+8% YoY). - Japanese models retain stable demand, while domestic NEVs gain in premium segments.
2. **B-Segment SUVs** - November wholesale: 454,200 units (27.47% share), up 10% YoY and 3% MoM. - Retail sales rose 5% YoY and 9% MoM. - Jan-Nov wholesale: 3.6393 million units (+7% YoY); retail: 3.1077 million units (+3% YoY). - Domestic NEVs are rising, eroding traditional fuel SUV advantages.
3. **B-Segment and Above MPVs** - B-MPVs: November wholesale: 45,100 units (44.82% share), up 40% YoY but down 8% MoM. - Retail sales grew 31% YoY and 17% MoM. - C-MPVs: Wholesale fell 20% YoY and 8% MoM; retail dropped 25% YoY and 5% MoM. - MPV growth has slowed, with BYD, Denza, and Trumpchi outperforming declining Japanese models.
Comments