According to the China Passenger Car Association (CPCA), China’s automobile exports are expected to slow in 2025 after maintaining its position as the world’s largest automobile exporter for the second consecutive year in 2024.
Export growth is expected to decline to 10%, with electric vehicle shipments expected to stagnate, CPCA Secretary-General Cui Dongshu said on Thursday.
China exported 4.8 million cars in 2024, an increase of 25% over the previous year. In the first 11 months of 2024, it exceeded 3.82 million vehicles in Japan. Exports of electric and hybrid vehicles, collectively called new energy vehicles (NEVs), rose 24.3% to 1.29 million units last year.
However, European tariffs on made-in-China electric vehicles imposed in late 2024 and reduced shipments to Russia are expected to weigh on export performance in 2025.
Domestically, China’s auto market continued to grow in 2024, with passenger car sales rising 5.3% to 23.1 million units. New energy vehicles accounted for 47.2% of total sales, supported by record high sales of electric and hybrid cars amid government support.
Beijing extended this support until 2025 to boost economic activity, with the goal that new energy vehicles constitute 57% of total car sales this year.
Local automakers such as BYD, Geely and Xiaomi benefited from higher demand, while Tesla recorded a new high in its sales in China despite a decline in its global sales. However, foreign manufacturers such as General Motors, Toyota, and Volkswagen have lost market share to local competitors, as they have suffered from excess capacity in their Chinese factories.
Despite the growth in sales, profitability in the automotive sector continues to decline. Profit margins fell to 4.4% in the first 11 months of 2024, down from 5% in 2023 and 6.2% in 2020, driven by a prolonged price war that depressed component and vehicle prices.
The CPCA estimates that total vehicle sales will grow by 2% in 2025, with new energy vehicle sales expected to rise by 20%, representing the slowest growth since 2021. Government support is expected to remain at high levels to support the sector.