Auto market stays firm ahead of policy change

China's automotive market held steady in November, with domestic brands and new energy vehicles driving growth, as companies gear up for year-end targets.

Seasonal demand, promotions and rising NEV adoption helped sustain momentum, said analysts. They added that momentum may continue to the end of December, as authorities are planning to stop favorable policies, including purchase tax exemption, from 2026.

"Mainstream automakers are achieving growth, NEVs continue to expand, and domestic brands are gaining competitive strength," said Ji Xuehong, director at the Automotive Industry Innovation Research Center at North China University of Technology.

BYD, China's best-selling NEV maker, reclaimed the top spot in monthly sales with 480,200 units, its highest monthly tally this year. Growth was led by the Dynasty and Ocean series, while its Fangchengbao sub-brand also drew consumer attention.

The Shenzhen, Guangdong province-based carmaker reported overseas shipments of 130,000 units.

Through November, BYD has sold 4.18 million units, on track to meet its internal target of 4.6 million.

SAIC Motor, partner of GM and Volkswagen, sold 460,800 vehicles in November. Its indigenous brands accounted for over 310,000 units, with NEV deliveries hitting a record 209,000 units. Overseas sales contributed 107,000 units.

SAIC is expected to meet its 4.5 million target if it continues momentum into December. Its cumulative sales so far stood at 4.1 million units.

Geely reported 310,400 units, up roughly 24 percent year-on-year, with NEVs making up more than 64 percent of sales. This performance brought the company's sales to 2.78 million units in the first 11 months. Geely is on track to comfortably achieve its annual goal of 3 million units.

Chery sold 272,500 units, including 116,800 NEVs, marking its highest monthly NEV volume. Changan delivered 283,000 units, including 125,000 NEVs. Both are within reach of their annual targets.

China FAW posted 306,000 units, led by domestic NEV growth as well.

FAW's cumulative sales stood at 2.99 million units, which means it needs to sell at least 450,000 units in December to reach its target.

China's largest pickup and SUV maker Great Wall Motor sold 133,200 vehicles, with its Tank and Wey brands posting strong performances. Overseas sales exceeded 50,000 units.

Chances are even thinner for Great Wall Motor, which has a goal of 4 million units for this year. Its January to November deliveries stood at 1.2 million units.

Startups saw record deliveries in the month. Leapmotor sold 70,327 units in November, up more than 75 percent year-on-year, marking the ninth consecutive month of strong growth.

Seres sold 55,203 NEVs in November, up 49.8 percent, reaching a monthly high. Its cumulative deliveries from January to November totaled 411,288 units. Avatr posted 14,057 units, also a record for the month.

Nio delivered 36,275 vehicles in November, up 76.3 percent year-on-year. XPeng's monthly deliveries reached 36,728, up 19 percent, bringing its January-November cumulative deliveries to 391,937 units, a 156 percent surge.

Analysts say the upbeat sales may continue to the end of the year, as car buyers would likely seize the last chance to enjoy the favorable purchase tax policy. The purchase tax for NEVs, which stands at zero, will go back to 5 percent in 2026.

Paul Gong, an automotive analyst at UBS, cautioned that policy rollbacks and rising comparable bases could lead China's passenger vehicle market to decline around 2 percent in 2026, with NEV growth likely to slow.

He added that domestic brands still have opportunities to capture market share from foreign competitors in the premium segment, while overseas sales appear to be a key driver of profitability in the mass market.

"Although we remain cautious on the industry in the near term, and the market will need time to absorb slower domestic demand and intensified price competition, we see technology innovation, product mix upgrades, and global expansion as the main growth drivers for Chinese automakers over the medium to long term," he said.

lifusheng@chinadaily.com.cn