After dominating the export market for two consecutive years in 2024, China’s car exports are expected to decline sharply this year, with shipments of electric vehicles expected to show little growth, according to an Automobile Association official.
Despite additional tariffs on Chinese-made electric vehicles introduced by the European Union at the end of October, China is likely to rank as the world’s largest car exporter for the second consecutive year in 2024, with car exports increasing. Data revealed that volume will increase by 25% to 4.8 million units. China Passenger Car Association (CPCA).
Japan’s automobile exports fell by 4.3% to 3.82 million units in the first 11 months of 2024, according to a report by the Japan Automobile Manufacturers Association.
However, export growth is likely to slow to 10% this year as shipments to Russia are expected to decline and pressure on European tariffs will increase further, according to CPCA Secretary-General Choi Dong-soo. EV exports are predicted to have “zero growth.” Last year, exports of new energy vehicles (NEVs), including plug-in hybrid vehicles and electric vehicles, increased by 24.3% to 1.29 million units.
The association said exports to the region had been negatively impacted by a year-long subsidy review of Chinese-made EVs, with the 10% increase in the first few months falling far short of the 36% increase in 2023.
According to the CPCA, the top three markets for cars produced in China were Russia, Mexico and the United Arab Emirates, while exports to Thailand, Australia and the UK declined in the first 11 months of 2024.
According to Charles Lester, a research analyst at Law Motion, setting up production facilities in Europe, like Hungary’s BYD, is unlikely, even if EU tariffs temporarily limit sales of Chinese-made EVs. It will also help Chinese automakers expand their market share in Europe in the long term.
With government subsidies of up to $2,000 for more fuel-efficient internal combustion engine vehicles and up to $2,800 for NEV sales, more than 6.6 million cars were sold last year. According to official data, more than 60% of the subsidy purchases were for NEVs.
According to CPCA, NEV sales are expected to increase by 20% this year, accounting for 57% of China’s total vehicle sales, and overall vehicle sales are expected to increase by 2% this year.
China’s auto sector has long suffered from declining profitability despite growing sales. Return on sales for the first 11 months of 2024 was 4.4%. This compares with 5.2% in 2023 and 6.2% in 2020, according to the association.
