China signals: Auto reset, airport splurges, Hainan highs, gold mania

This Spring Festival offers a revealing snapshot of China’s growing economic ambitions at home and abroad. Chinese automakers are storming European markets — MG surpassing one million cumulative sales in Europe and the U.K., and BYD leading EU growth with a 227.8% increase — while established rivals stall. At airports across Asia-Pacific, Chinese travelers lead luxury spending at twice the regional average, reshaping duty-free retail. Hainan’s first Spring Festival since its customs closure delivered record duty-free sales, with visa-free foreign arrivals surging. And despite record gold prices, the festive gold surge saw foot traffic at Shenzhen’s Shuibei Jewelry Market rise 30% and queues at Lao Feng Xiang stores stretching hours, while foreign shoppers — including Elon Musk’s mother — joined the rush for traditional Chinese brands. China’s automakers rewrite Europe’s rulebook Market intel: Chinese automakers dominated European growth in 2025. MG became the first Chinese brand to surpass one million cumulative sales in Europe, with annual sales climbing from 50,000 in 2021 to over 300,000 in 2025. BYD led all brands with 227.8% YoY EU registration growth. This contrasts sharply with an otherwise sluggish market, where Stellantis fell roughly 6% YoY and Tesla dropped 37.9% YoY within the EU. Meanwhile, Chinese brands continued gaining ground in January 2026 as Western markets contracted, completing a repositioning from low-cost exporters to technology-premium competitors. Market indicator: Europe’s automotive ecosystem is shifting rapidly. Chinese brands are no longer competing on price alone — they’re gaining ground on technology, with advances in battery design and intelligent driving systems that legacy automakers have been slow to match. For luxury brands across sectors, the lesson is instructive: technological credibility and localization can erode even the most entrenched market positions. As Chinese automakers push further upmarket, the competitive rules of global brand-building are being rewritten. Chinese travelers lead airport luxury spending Market intel: A new ACI Asia-Pacific and Middle East report finds that Chinese travelers lead airport luxury consumption at twice the regional average. The study, covering 36 major airports, found that millennial and Gen Z travelers spend five times more on luxury goods than older generations. Despite growing digital adoption, approximately 70% of purchases remain impulse-driven in physical stores, with product selection and price the primary motivators. Duty-free operations contribute 31-38% of total airport retail sales in Middle Eastern markets, rising to over 50% in several Gulf states. Market indicator: A new generation of Chinese travelers is driving the airport retail resurgence, treating luxury shopping as an integral part of the travel experience. For brands, this reinforces the enduring importance of physical retail in travel hubs — not merely as sales channels, but as brand-building touchpoints. The high rate of impulse purchases suggests that strategic product placement and exclusive airport offerings can capture a meaningful share of spend. One gap stands out: 65% of Gen Z travelers say they would pay a premium for sustainable products, yet only 20% of airports make sustainability a priority — a differentiation opportunity brands have been slow to exploit. Hainan’s full duty-free debut breaks records Market intel: Two months after launching island-wide customs operations, Hainan Free Trade Port marked its first Spring Festival with strong results. Duty-free sales for the nine-day holiday totaled 2.72 billion RMB ($390.8 million), up 30.8% year-on-year, with 325,000 shoppers purchasing nearly two million items. Outdoor sportswear emerged as a standout category, with queues forming outside Arc’teryx and On Running stores. Market indicator: Hainan’s evolution from tourist destination to integrated trade hub is proving commercially compelling. The duty-free sales figures demonstrate that the island's distinctive offer — tropical tourism combined with tax-free shopping — remains powerfully attractive to both domestic and international visitors. For luxury brands, the strong performance of outdoor and performance wear points to shifting consumer priorities, even in duty-free contexts. And as Hainan moves beyond pure retail into a broader travel experience, its role as a luxury gateway appears to be strengthening rather than eroding. Eight-hour queues, record prices: China’s gold rush rolls on Market intel: Despite spot gold prices hovering around $4,900–$5,000 per ounce during the holiday and domestic jewelry exceeding 1,500 RMB ($217) per gram, China’s Spring Festival gold rush showed no signs of slowing. Queues at some Lao Feng Xiang stores stretched beyond eight hours. Foot traffic at Shenzhen’s Shuibei Jewelry Market surged 30%, though consumers gravitated toward lighter, lower-gram items such as zodiac pendants and gold phone stickers. The “Ancient Method Gold” — jewelry made using traditional Chinese goldsmithing techniques — trend continued to draw both domestic and international buyers, among them Maye Musk, mother of Elon, who was spotted purchasing from LaoPu Gold. Market indicator: Gold’s enduring appeal in China transcends price sensitivity — it is cultural, emotional, and increasingly, a global phenomenon. The willingness to queue for hours at record prices underscores gold’s unique position as both investment vehicle and identity marker. The growing presence of foreign buyers, drawn by China’s expanded visa policies and cultural curiosity, hints at untapped export potential for traditional Chinese jewelry brands. For luxury brands more broadly, the takeaway is instructive: when a product is embedded in cultural tradition and emotional significance, price sensitivity contracts dramatically. The harder challenge is achieving that depth of resonance in the first place.

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China signals: Auto reset, airport splurges, Hainan highs, gold mania