Industry data revealed by CnEVPost shows China’s passenger new energy vehicle retail sales are projected at a record 1.38 million units for December, with a penetration rate of 60%, even as overall auto demand softens year-on-year. According to the China Passenger Car Association (CPCA), early estimates indicate overall passenger vehicle retail sales for December 2025 are projected to grow by 3.4% month-on-month to approximately 2.3 million units. However, it is important to note that the figures actually represent a 12.7% decrease year-on-year.
The EV market is now seen as a core growth driver in the Chinese automotive industry as the year-on-year growth rates of NEV (new energy vehicles) in terms of production and sales have both exceeded 30% in 2025, with the proportion of NEV sales growing to 47.5% this year. According to the CPCA, the retail penetration rate of NEVs has already reached 50% in March 2025 and has continued to grow, reaching a peak of 79.6% in November.
Cumulative NEV sales in China have been dominated by domestic brands such as BYD (4.182 million units sold from January to November 2025), Geely New Energy (1.534 million units sold from January to November 2025), as well as other brands including SAIC Motor, Changan Automobile, and Chery Automobilec. Of the mentioned brands, Geely New Energy has seen the largest annual growth rate compared to the previous rate with its sales numbers growing by 97.35%.
The month of December is traditionally seen as the peak season for China’s automotive market as manufacturers launch seasonal promotions and events to hit their sales targets. This YoY decline is suspected to have occurred due to the suspension of replacement and trade-in subsidy programs in several provinces starting in November this year. As supporting policies and programs diminish, the automotive market is entering a correction phase to the normalized seasonal track.
In an effort to mitigate the expected headwinds from this shift, over 20 NEV brands introduced purchase tax programs in December, which state that the manufacturer will cover any additional purchase tax incurred for buyers who placed their orders before the end of the year (31 December 2025) but who have not received their vehicles in time. China’s NEV industry is also expected to grow beyond its domestic market as exports have effectively doubled year-on-year between the months of January and November, reaching 2.315 million units. This number can be further separated into the NEV passenger vehicle exports, which totaled at 2.238 million units, and NEV commercial vehicle exports, which reached 77,000 units.
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