2026-01-16 02:56Summary of the China Passenger Vehicle Monthly Chartbook - December 2025 Industry Overview - The report focuses on the passenger vehicle (PV) and new energy vehicle (NEV) industry in China, highlighting trends in retail and wholesale volumes, inventory levels, pricing, and battery prices [1][2][5]. Key Industry Trends - NEV Retail Growth: NEV retail growth decelerated to +3% year-over-year (yoy) in December 2025, down from +4% yoy in November 2025, attributed to decreasing subsidies [1][5]. - ICE Decline: Internal combustion engine (ICE) vehicle sales further deteriorated, showing a decline of -31% yoy in December, compared to -22% yoy in November, with higher ICE inventory levels [1][5]. - Export Growth: Exports of passenger vehicles (PV) and NEVs showed significant strength, with growth rates of +47% yoy and +164% yoy respectively in November, compared to +41% yoy and +67% yoy in October [1][5]. Detailed Industry Data - December 2025 Highlights: - PV retail sales decreased by -14% yoy and increased by +2% month-over-month (mom). - Wholesale sales for PV decreased by -9% yoy and -7% mom. - NEV retail sales increased by +3% yoy and +1% mom, while wholesale sales increased by +3% yoy but decreased by -8% mom. - NEV retail penetration reached 59.1%, an increase of 9.7 percentage points (pp) yoy, while wholesale penetration was 56.0%, up 6.8 pp yoy [5][6]. Pricing and Inventory Trends - Inventory: NEV inventory remained stable, while ICE inventory levels increased [5][6]. - Pricing: Dealer discounts for both NEVs and ICE vehicles narrowed month-over-month, with one NEV manufacturer implementing a price cut [6]. - Battery Prices: Lithium cobalt oxide (LCE) battery prices increased by +32% mom, while lithium iron phosphate (LFP) and nickel-cobalt-manganese (NCM) battery prices remained flat [6]. Company Highlights - BYD: - Delivered 133,000 units of export volume in December 2025, maintaining strong overseas expansion momentum. - Expected overseas sales volume to reach between 1.5 million to 3.5 million units from 2026 to 2035, driven by NEV penetration and product competitiveness. - Forecasted 30% earnings compound annual growth rate (CAGR) from 2025 to 2028, with overseas profit contribution expected to rise from 21% in 2024 to 60% by 2028 [6][7]. - XPeng: - Delivered 32,000 units of domestic retail volume in December 2025, reflecting a -5% yoy decline but a +2% mom increase. - Market share remained relatively stable with a -0.2 pp change. - Blended transaction price increased by 5% yoy and 4% mom, attributed to a favorable model mix [7]. Future Outlook - Domestic PV and NEV volume growth is expected to slow down in 2026, with projections of -2% yoy for PV and +11% yoy for NEV, compared to +4% yoy and +18% yoy in 2025. - Exports are anticipated to be a bright spot for the industry, particularly for companies like BYD, which is well-positioned for overseas exposure [6][7]. Conclusion The December 2025 report indicates a challenging environment for the domestic PV market, particularly for ICE vehicles, while NEVs continue to show growth albeit at a slower pace. Export opportunities remain robust, particularly for leading companies like BYD and XPeng, which are expected to capitalize on international markets in the coming years [1][5][6][7].