BOCOM International released a research report stating that the automotive market in January 2026 experienced relatively subdued overall performance due to seasonal factors coupled with the effects of earlier consumption being pulled forward. Although the extension of the "scrappage" scheme provided a floor for support, significant consumer hesitation at the retail level led to the deferral of some demand. Looking ahead, as detailed implementation rules are accelerated across regions, market sentiment is expected to gradually recover. Regarding exports, benefiting from positive progress in tariff negotiations between China and Europe and between China and Canada, alongside the deepening globalization strategies of domestic brands, the overseas expansion of new energy vehicles is transitioning from pure trade exports to an "industrial chain export" model. For specific stocks, the report suggests focusing on: XPeng Inc. (09868/XPEV), as its new P7 and extended-range models are being launched successively, while localized overseas production is gradually being implemented, driving increases in sales volume and gross margin; GEELY AUTO (00175), as the privatization of Zeekr facilitates internal resource integration; and Byd Company Limited (01211), as its overseas production capacity enters a volume ramp-up phase, with growth in overseas sales expected to further optimize its profit structure. The main views of BOCOM International are as follows:
Domestic automotive market pressure in January stemmed from policy adjustments and pulled-forward consumption, with joint venture brands showing relative resilience. Influenced by multiple factors including the expiration of the new energy vehicle purchase tax exemption, adjustments to the scrappage subsidy, and the effect of demand being pulled forward, retail sales of passenger vehicles in mainland China in January 2026 reached 1.544 million units, a year-on-year decrease of 13.9%. In terms of market structure, domestic brands faced adjustments, with monthly retail sales of 890,000 units, down 18% year-on-year, and their market share narrowing by 3.5 percentage points to 57.5%. Joint venture brands outperformed the overall market, with retail sales of 470,000 units, representing only a slight 4% year-on-year decrease. Among these, the market share of German and Japanese brands increased by 1.4 and 2.1 percentage points to 19.8% and 15.5%, respectively.
The penetration rate of new energy vehicles saw a significant decline in January, falling to 38.6%, while the share of new automakers increased against the trend. Retail sales of new energy passenger vehicles in January were 596,000 units, a year-on-year decrease of 20.0%. The penetration rate of new energy vehicles fell by 20.5 percentage points month-on-month to 38.6%. Analysis by segment shows significant declines in penetration rates across the board: the penetration rate for domestic brands was 61.7% (down 19.2 ppts month-on-month), while for luxury brands it dropped to 16.1% (down 23.0 ppts month-on-month). Notably, the market share of new automakers increased by 7.7 percentage points month-on-month to 31.2%.
Exports continued their strong momentum, with the proportion of new energy vehicles nearing 50%. Passenger vehicle exports (including complete vehicles and CKD kits) in January totaled 576,000 units, a year-on-year increase of 52.0%. By brand type, domestic brands remained the main driver of exports, with 476,000 units exported during the month, up 49% year-on-year. Exports of joint venture and luxury brands reached 100,000 units, growing by 65%. Benefiting from the continuously improving international recognition of domestic new energy vehicles, exports of new energy passenger vehicles in January reached 286,000 units, surging 103.6% year-on-year. Their share of total exports rose to 49.6%, an increase of 12.5 percentage points year-on-year.
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