The China Passenger Car Association (CPCA) said China’s passenger-car market remained under pressure in May, with domestic demand staying weak while exports continued to expand and electrification deepened further. The market showed three clear trends: softer overall volume, month-on-month recovery, and ongoing structural divergence. Sales trends from 2022 to May 2026. Retail Sales Recover Sequentially, Exports Continue to Rise Retail sales of passenger vehicles reached 1.51 million units in May, down 22.1% year-on-year but up 9.2% from April. For the first five months, retail sales totaled 7.099 million units, down 19.5%. Wholesale deliveries reached 2.212 million units in May, down 4.6% year-on-year, up 4.8% month-on-month. Domestic demand remained sluggish; overseas markets provided the main source of growth. Passenger-car exports (including complete vehicles and CKD shipments) reached 784K units in May, up 75.1% year-on-year and 2.3% from April. Exports accounted for 35% of automaker sales, versus just 19% a year earlier. Chinese brands exported 682K units, up 83%; joint-venture and luxury brands exported 102K units, up 36%. According to the report, the biggest drag on domestic sales remained the collapse of fuel-powered vehicles. Retail sales of gasoline-powered cars fell 39% from a year earlier, accounting for 82% of the overall decline in passenger-car retail volume. NEV Penetration Hits Record 62.9% New-energy passenger-vehicle retail sales reached 950K units in May, down 7.5% year-on-year but up 12.4% month-on-month. Market penetration climbed to a record 62.9%, marking an increase of 9.9 percentage points from a year earlier and up 1.6 percentage points from April. Analysis of retail and export data for May 2026. Wholesale NEV deliveries reached 1.352 million units, up 10.6% year-on-year and 10.3% month-on-month. NEVs accounted for 61.1% of total wholesale volume, eight percentage points higher than a year earlier. Sixteen models recorded wholesale sales above 20K units. The BYD Song ranked first with 75,825 units, followed by the Tesla Model Y with 54,765 units and the BYD Yuan Up with 41,414 units. Battery-electric vehicles remained dominant, with wholesale volume reaching 886K units (up 16.6%), accounting for 65.7% of all NEV sales. Plug-in hybrids contributed 372K units (27.5%), while range-extended vehicles reached 95K units (7.0%). Analysis of production and wholesale data for May 2026. Across segments, B-class electric vehicles stood out with wholesale sales of 273K units, up 42% year-on-year, representing 31% of total BEV volume. In contrast, entry-level electric cars faced mounting pressure: A00-class EV sales fell 44% year-on-year to 87K units. The CPCA noted that affordable EV adoption remains critical for sustaining long-term market growth. Chinese Brands Extend Lead China’s leading automakers continued to dominate the NEV market. Traditional manufacturers such as BYD, Geely, and Chery strengthened their positions, particularly in the plug-in hybrid segment, as automakers increasingly pursue multiple powertrain strategies to broaden market coverage. Twenty automakers recorded wholesale NEV sales above 10K units in May, accounting for 93.4% of total market volume. BYD led with 376,990 units, followed by Geely (131,037), Chery (94,806), and Tesla China (85,982). Six emerging EV brands also entered the top rankings. On the retail side, sixteen brands exceeded 20K units. BYD remained first with 207,372 units, followed by Geely (109,198), Changan (62,865), Leapmotor (61,401), and Tesla China (47,281). Manufacturer rankings for May NEV Exports Reach Record 54% Share China’s NEV export momentum accelerated further in May. Exports reached 424K units, up 112.6% year-on-year and 4.4% month-on-month. NEVs accounted for 54.0% of total passenger-car exports, setting another record. The export powertrain mix also shifted: battery-electric vehicles represented 59.3% of exports, plug-in hybrids 36.2%, and range-extended vehicles 4.4%. Plug-in hybrids have emerged as a key growth engine, particularly across developing markets. BYD remained China’s largest vehicle exporter with 155,944 units, followed by Chery (62,398), Geely (39,811), and Tesla China (38,701). Leapmotor shipped 20,168 units overseas, ranking sixth. China’s Global Share Continues to Rise From January through April, China accounted for 31% of global vehicle sales, 61% of global NEV sales, and 71% of the global plug-in hybrid market. The figures underscore China’s growing influence across the global automotive supply chain. NEV market sales trends from 2022 to May 2026. Looking ahead, the CPCA expects automakers to push sales aggressively in June as the industry approaches the mid-year reporting period. However, softer domestic demand, delayed holiday effects, and major sporting events could continue to weigh on year-on-year growth. The association expects NEV penetration to remain above 60% in June, with exports staying strong and continuing to offset weakness in the domestic market.
