China car sales slump 24% in September despite peak season

China car sales dropped 24% on the year in September to 1.702 million units, industry data showed, as weak demand dragged on despite the peak season.

The China Passenger Car Association (CPCA) released the figures. New energy vehicles (NEVs), a group covering electric and plug-in hybrid cars, also lost ground, with retail volume down 12% at 1.141 million.

Still, China car sales in September beat August. Overall retail sales rose 10% month on month, while NEV retail climbed 14%.

For January to September, retail volume came to 13.418 million units, 21% lower than a year ago. Over the same nine months, NEV retail reached 7.816 million, a 12% fall.

China car sales surge late in the month

Weekly data showed a sharp rise towards the end of September. Early in the month, dealers sold an average of 35,000 cars a day.

Demand then softened in mid-September, in part because of when the Mid-Autumn Festival fell. By the fifth week, however, daily sales had shot up to an average of 148,000.

Wholesale figures also improved on the month. Factories shipped 2.528 million passenger cars to dealers in September, a 10% annual decline but a 7% rise on August.

Year to date, carmakers have wholesaled 19.711 million units, 6% fewer than in the first nine months of last year.

Electric models hold up better

New energy vehicles proved more resilient than the wider market. In fact, two in every three cars sold at retail, or 67.1%, were NEVs.

In addition, NEV shipments to dealers rose 11% both on the year and on the month, to 1.672 million units. These models took a 66.1% share of wholesale volume.

Since January, NEV wholesale volume has reached 11.45 million, a 9% increase on last year.

By contrast, petrol cars continued to suffer. In the first three weeks of September, factories built 330,000 conventional petrol light vehicles, less than half the level a year earlier at minus 52%.

Output of hybrids and plug-in hybrids fell 23% over those weeks to 265,000. Both types, however, rose strongly from August.

A tough year for China car sales

The September data extend a long slump. In August, total retail fell 19% from a year before to 1.626 million cars, even as the NEV share hit a record 65.7%.

In July, the CPCA cut its 2026 retail forecast to a 14% decline. The group now sees deliveries of 20.4 million this year, well short of last year’s record 23.7 million.

Analysts at the time warned of worse. Xiao Feng of Citic CLSA has projected a 20% fall in sales this year. “This is going to continue to be a brutal year,” said Tu Le, founder of Sino Auto Insights.

Several factors lie behind the weak China car sales. Rising fuel costs have hurt sales of petrol cars, while a pullback in NEV subsidies has cooled buyer interest.

At the same time, carmakers face rising costs for batteries, lithium and memory chips. As a result, industry profit margins fell to 3.4% between January and May, CPCA data showed.

Feng expects these thin margins to force a shakeout, leaving seven or eight major players in the electric car market by 2030.

Seasonal promotions and new model launches offered some support in September. Overall, though, the market fell short of the strength usually seen in the peak sales season.