China auto sales: January drop signals premium market shift

China’s passenger vehicle sales dropped sharply last month, falling 32% month-on-month to 1.8 million units, according to data from the China Passenger Car Association (CPCA). The decline, which also represented a 12% year-on-year decrease, particularly impacted premium automakers as consumers pulled back on spending following aggressive year-end promotions. The luxury segment saw additional pressure as Chinese domestic brands continued gaining market share. Notably, Geely Automobile Holdings outperformed BYD in January retail sales, marking a significant shift in China’s premium auto landscape that has traditionally been dominated by foreign luxury brands. Market share transformation This market realignment follows China’s record-breaking 2024 performance, when the country captured 41% of global auto market share in December. The market’s transformation has particularly challenged European luxury automakers, with Mercedes-Benz, BMW, and Audi seeing their combined market share in China decline throughout 2024, while facing heightened competition from domestic premium electric vehicle manufacturers. New energy vehicle (NEV) sales reached 744,000 units in January, up 10.5% YoY but down 43% from December’s figures. This segment is especially crucial for luxury brands, as premium EVs represent a key battleground between established global automakers and ascending Chinese brands. Looking ahead, industry analysts expect the Chinese auto market to grow by approximately 2% in 2025, according to ING research. However, European luxury manufacturers face ongoing headwinds as Chinese consumers increasingly favor domestic brands that offer competitive premium features at lower price points, with local brands now accounting for 65.2% of China’s passenger car market sales. The Jing Daily Data Snapshot analyzes the latest data on China’s luxury and lifestyle markets.

Foreign luxury cars hit speed bump in China

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Foreign luxury cars hit speed bump in China