China's Passenger Car Market in September 2025: Record Sales and Shifting Dynamics

The national passenger car market witnessed a robust performance in September 2025, with retail sales reaching 2.241 million units. This represents a 6.3% year-over-year increase and an 11% month-over-month growth. Cumulative retail sales for the year now stand at 17.005 million units, reflecting a 9.2% rise compared to the same period last year. The market's growth trajectory has evolved from a modest 1.2% in early months to a peak of 11% by mid-year, before settling into a more stable pattern around 6% in recent months. This aligns with the anticipated "low start, mid-year surge, and steady finish" trend forecasted earlier in the year. Notably, September sales surpassed the previous record set in September 2017 (2.19 million units) by 50,000 vehicles, highlighting strong consumer demand ahead of anticipated policy adjustments.

Market Performance and Retail Trends

The automotive sector is transitioning toward a more stable phase, characterized by reduced price wars and moderated promotions. Statistics based on official price cuts or models breaching their lowest guided prices in two years show 23 models involved in price reductions this September, down from 36 last year but up from 11 in 2023. This indicates a calmer competitive landscape. Promotional efforts for new energy cars remained elevated at 10.2%, up 2.6 percentage points year-over-year and 0.7 points from August. In contrast, discounts for traditional fuel-powered automobiles averaged 23.9%, rising 1 point monthly and 1.9 points annually.

Segment Analysis: Electric Vehicle Dominance

The electric vehicle segment continues to drive market expansion. Battery car sales, particularly pure electric models, saw a 32.4% year-over-year surge in wholesale volume. Plug-in hybrids and range-extended electric vehicles grew by 8.4% and 8.7%, respectively. The structure of sales among new automakers shifted significantly, with pure electric cars now accounting for 70% of sales, compared to a 50-50 split with range-extended models last year. The penetration rate of new energy cars in domestic retail reached 57.8% in September, supported by nationwide trade-in programs and tax exemption policies for clean energy vehicles.

Production, Wholesale, and Inventory Insights

Automobile production hit 2.838 million units in September, a 17.2% annual increase and 15.7% monthly gain. Cumulative production for January to September totaled 20.78 million units, up 13.9% year-over-year. Wholesale volume also set a monthly record at 2.803 million units, rising 12.4% year-over-year and 13% month-over-month. Autonomous brands led production growth with a 21% annual increase, while joint ventures and luxury automakers saw more modest gains. Inventory levels rose by 70,000 units in September, indicating proactive stockpiling by manufacturers compared to last year's drawdown.

Brand Performance: Autonomous Brands Lead

Domestic automakers achieved retail sales of 1.5 million units in September, a 13% year-over-year increase and 12.9% monthly growth. Their market share reached 66.9%, up 3.6 percentage points from last year. Key state-owned groups like SAIC, Dongfeng, Changan, Chery, and BAIC saw collective growth of 25%, with subsidiaries such as Deepal, Voyah, and Arcfox posting strong results. In contrast, mainstream joint venture brands sold 490,000 units, down 6% annually, with German and Japanese brands losing share. Luxury car retail fell 1% to 240,000 units, though their share decline was less pronounced.