China NEVs Take 63.6% Market Share as Petrol-Car Output Falls 60%

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China’s new energy vehicle retail sales declined in the first 16 days of August, but the segment continued to outperform the wider passenger-car market as higher fuel costs weighed more heavily on demand for petrol vehicles.

Passenger NEV retail sales reached 399,000 units from August 1 to August 16, down 15 per cent year on year but up 1 per cent from the corresponding period in July, according to the China Passenger Car Association. Overall passenger-vehicle retail sales fell 22 per cent year on year to 628,000 units.

NEVs retain a 63.6 per cent share

NEVs accounted for 63.6 per cent of passenger-vehicle retail sales during the period, underlining their continued market strength despite the decline in unit sales.

The penetration rate remained high, although it was below the record 65.1 per cent retail share reported for July. 

Year-to-date passenger NEV retail sales stood at 6.067 million units, down 13 per cent year on year. Total passenger-vehicle retail sales for the year to date reached 10.801 million units, down 20 per cent from a year earlier. 

The figures show that NEVs are continuing to gain relative importance within China’s auto market even as consumers become more cautious about car purchases overall.

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Fuel costs pressure petrol vehicles

The CPCA said higher oil prices have increased the operating and maintenance costs of petrol vehicles, weakening consumer willingness to buy conventional models.

China raised domestic refined-fuel prices twice in July by a combined nearly CNY 985 (USD 145) per tonne, after disruption to shipping through the Strait of Hormuz contributed to oil-market volatility. NEV prices remained broadly stable during the period.

The impact was particularly visible in production data. China produced 137,000 petrol-powered light vehicles during the first week of August, down 60 per cent year on year and 42 per cent from the same period in July. 

Combined production of hybrid and plug-in hybrid vehicles was 73,000 units in the same week, down 33 per cent from a year earlier and 35 per cent from July. 

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Wholesale data shows resilience 

Passenger NEV wholesale sales reached 425,000 units from August 1 to August 16, down 3 per cent year on year but up 6 per cent from the corresponding period in July.

NEV wholesale penetration reached 72.9 per cent, rising from 70.9 per cent in the first week of August. Year-to-date NEV wholesale sales totalled 8.673 million units, up 7 per cent year on year.

By comparison, overall passenger-vehicle wholesale sales totalled 583,000 units in the first 16 days of August, down 25 per cent year on year and 1 per cent from the same period in July. Year-to-date wholesale sales were 15.393 million units, down 6 per cent year on year.

August recovery expected

The CPCA expects the auto market to improve in the second half of August, supported by the back-to-school season, demand for smaller electric vehicles, available trade-in subsidy funding and new-model launches around the Chengdu Auto Show.

The association said consumer sentiment remained cautious, but the combination of new EV launches and subsidy support could strengthen demand later in the month.

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