Chinese carmakers shipped roughly 796,000 passenger vehicles abroad in April, nearly 85% more than a year earlier, according to data released Monday by the China Association of Automobile Manufacturers. The brisk export growth, driven by a more than doubling of shipments of new energy vehicles, stands in stark contrast to a domestic market that saw sales fall for a sixth straight month, underscoring the lopsided pressure on the world’s largest auto market.
The domestic passenger-car market shrank 25.5% from a year earlier to 1.3 million units, CAAM said, as buyers held off purchases amid dialed-back government subsidies for electric-vehicle purchases and a broader economic unease tied to China’s prolonged property slump. The subsidy changes, which last year gave consumers direct cash incentives to trade in older cars, have left many households unwilling to purchase new vehicles until they better understand the new rules, said Yichao Zhang, an automotive practice partner at consultancy AlixPartners.
Some analysts see a potential stabilization later in 2026 as automakers roll out new models — more than 1,450 vehicles were displayed at last month’s Beijing auto show — and as consumers adjust to the subsidy framework. “More Chinese consumers will also probably start buying new cars again as they increasingly adjust to the government subsidy changes this year,” Zhang added.
Overseas, leading Chinese brands such as BYD and Geely Auto are making rapid inroads. BYD, the country’s largest EV maker, has been building factories in Europe and Latin America, adding production capacity abroad to complement its surging exports. In Australia, BYD was the second-highest-selling brand behind Toyota in April, according to the Federal Chamber of Automotive Industries, as EV adoption accelerates: one in six new vehicles sold in the country were battery electric.
The war in Iran, which has driven up global petrol prices, is strengthening the business case for electric vehicles. “With oil and fuel prices likely to stay elevated for a longer period, it would incentivize consumers to buy EVs and this will benefit Chinese EV exports,” said Claire Yuan, an auto analyst at S&P Global Ratings. AlixPartners forecasts that China’s overall passenger-car exports could rise by about 20% this year, with Southeast Asia a key growth region.
Beijing has made headway in trade talks with the European Union and Canada over their imports of Chinese EVs, even as the American market remains largely off-limits. A 100% tariff imposed by the Biden administration in 2024 effectively blocked Chinese EVs from the United States, and the Trump administration has maintained the barrier. Industry officials are watching closely a planned meeting this week between U.S. President Donald Trump and Chinese leader Xi Jinping in Beijing for any sign of a shift in trade policy.