Car Industry 2026 Q1 Update Asia

China

BYD Hit By Tax & Incentive Changes, More Competition

The increase in EV sales tax from 0% to 5% (ICEVs have a 10% rate) from January 1st caused a steep drop in sales of electric vehicles, particularly hitting the PHEV sector in which BYD has a large share. The trade-in subsidies were also restructured to a percentage of the vehicles price, rather than a fixed amount, benefitting more expensive vehicles; with BYD’s sales skewed toward the lesser expensive vehicles. Its Denza and Yangwang brands have not been very successful in the face of competition from the more high end and luxury focused brands such as HIMA, Xiaomi, Li Auto, Nio and Geely’s Zeekr and Lynk & Co. BYD also sells very few EREVs, a segment which actually grew sales y-o-y. The only bright spots for BYD in January were exports of 100,482 (+51.47%) and the Fengchangbao brand.

The drop in EV sales between December and January (55%) was larger than the drop in overall vehicle sales, showing that the ICEV segment remained resilient; in January the EV market share fell to 38.6% which is lower than the previous year. That drop was highly concentrated:

• More than 55% drop: BYD (73%), SGMW (70%), GWM (63%), Chery (63%), Leapmotor (62%)

• Less than 55% drop: Xiaomi (22%), Geely (32%), HIMA (35%), Dongfeng (41%), Nio (43%), Xpeng (47%), Changan (50%)

The EV market share did recover somewhat to 45% in February and then 52% in March, but this did not help BYD very much as its Q1 2026 sales were down 51.7% on the same period the previous year. Geely saw a much lesser 21.9% year on year drop in the first quarter, and together with its ICEV sales took the #2 spot in overall car sales just below VW (with BYD third and Toyota fourth). A surprise has been the relatively good performance of the smaller luxury Chinese brands of Nio, Li Auto, GAC Aion and Xpeng.

Interestingly, from April 1st to April 19th, EV sales were down 14% y-o-y, but overall car sales were down by 26%; with the EV share rising to 61.7%. With EV sales falling only 5% vs. March, the overall m-o-m sales fall of 18% means that ICEV sales fell about 30% m-o-m. Many new EV models with new technology and highly competitive prices, together with the US-Iran War, seem to be returning the car market to the trends in force toward the end of 2025. Which EV brands will benefit the most from this, will BYD be able to recover its lost ground? Which ICEV brands will hurt the most, with ICEV sales falling about 30% m-o-m and y-o-y?

As noted in my last quarterly update, the competition in the luxury sector just keeps getting more crowded. From the Xiaomi refresh of its SU7, a stretched “executive” version of the SU7, the YU7 GT, a 5-seat EREV SUV, and a 7-seat EREV SUV. With HIMA planning a super-luxury SUV EREV (with JAC Maextro), a large MPV EREV and a large SUV EREV (with Chery-Luxeed), the BEV/EREV M6 and M9 SUVs (with Seres-Aito), a BEV/EREV S9 sedan and wagon, together with an MPV (with BAIC-Stelato), a high end sedan and SUV (with SAIC-Shangje), and even launching a new brand with Dongfeng. Nio plans to release the ES9 and ES7 BEV SUVs, and Xpeng is set to introduce four new large BEV/EREV SUVs. It may be incredibly hard for the BYD Denza and Yangwang brands to just hold their ground this year. At the same time, some of the German (VW and AUDI) and Japanese (Toyota, Nissan, Mazda) brands are attempting to make gains in the EV space through the aggressive pricing of vehicles that to all intents and purposes are variations of vehicles produced by their Chinese joint venture partners.

Competition At The Low End Intensifies: By Design

By halving the EV sales tax subsidy, and weighting the car purchase subsidies more toward more expensive models, the Chinese Party-state has greatly increased the competitive pressures at the lower end of the EV market; while also reducing the competitiveness of EVs with respect to ICEVs. As a result, it can be expected that the drive to cut costs at the low end will intensify. This will tend to drive a faster adoption of sodium-ion batteries that reduce costs at the low end, while also pushing EV brands toward a greater export orientation. The additional domestic competitiveness is driving a new surge in Chinese car exports; with overall exports of 695,000 (+74.3%) and EV exports of 349,000 (+140%) in March alone.

Here is the quite basic Wuling Xingguang 560 5-seat and 7-seat ICEV/BEV/PHEV, larger than a Honda CRV or Chevrolet Equinox, combined PHEV range of 1100 km (125km electric only), BEV range of 500km with 2C fast charging. The ICEV is priced from RMB 59,800 (US$8,400) to RMB 73,800 (US$10,300), the PHEV costs RMB 89,800 (US$12,600), and the BEV costs RMB 98,800 (US$13,900). It is priced lower than the competing BYD BEV/PHEV equivalents. As with Geely, Chery etc., Wuling sells both ICEV and electric vehicles, moderating the impact of the increase in EV car tax. At the low end of the market (A and B segment) its Wuling (Mini & Bingo), Geely (with the Xingyuan & Panda Mini) and Dongfeng (the Lumin) that are making life so difficult for BYD.

Leapmotor is also driving competition with the introduction of its A-series SUV that is expected to be priced from RMB 75,000 (US$10,870), a direct competitor for the BYD Atto 2 / Yuan Up. With a “very generous” amount of interior space for such a vehicle. It will also be exported to Europe and other foreign markets, promising to give another jump to Leapmotor’s sales. The company plans to sell 1 million vehicles in 2026, after 600,000 in 2025.

In the C segment, BYD’s main competitors are the ICEV Nissan Sylphy and VW Lavida; both of which gained a 5% price advantage with the car tax change. The only segment that it really dominates is the D segment, competing with the Tesla Model Y. The E segment is dominated by Xiaomi, with the SU7 and YU7.

Tesla Falls Flat In Q1

Tesla sales actually fell between February and March, when the last month of each quarter is usually the best selling month for Tesla, and overall BEV sales doubled between the two months. In February and part of March the Tesla Model 3 had something of a free run as buyers awaited the refreshed Xioami SU7; but even with that and the Model Y L, Tesla Q1 sales were down 16.4% on a y-o-y basis. Tesla’s Q2 performance will show if this is part of an accelerating trend, especially with the full availability of the refreshed Xiaomi SU7. As shown below, it is not just Xiaomi which is causing problems for Tesla, Li Auto has also become significantly more competitive with the i6; as the commentator notes “the Model Y is getting squeezed from all directions”. Tesla was also helped in Q1 by a battery supply chokepoint for the i6 that has now been solved.

VW & Japanese Reprieve, German Luxury Nightmare?

The biggest winners may be VW and the Japanese brands, as their models are weighted toward the cheaper end of the ICEV spectrum, although they have had little luck in breaking into the NEV space; as witnessed by VW’s sales of only 9,400 BEVs in Q1, a fall of 64% y-o-y. VW is leveraging its joint-venture partners in an attempt to turn the tide. Below, the VW ID. Unyx 08 BEV crossover, with Xpeng tech and built by JAC, starting at RMB 239,900 (US$34,760). With competitors such as the Xiaomi YU7, Zeekr 7X, and Li Auto i6 plus many others to contend with, it may not be that great a sales success in China; and now even the new Seres Aito M6 BEV/EREV from only RMB 259,800 (US$37,650). Also, why not just get an Xpeng G9 instead of the based on Xpeng tech VW? The biggest challenge for VW and the Japanese brands is how to gain success in the incredibly crowded and competitive Chinese EV space.

Below is the VW ID Era 9X 6-seat EREV built by SAIC (“Unyx” is Xpeng tech built by JAC; “Era” is built by SAIC; “Aura” is built by FAW), starting at RMB 329,800 (US$47,700) with a CLTC range of 400km (electric only) and1,000km (combined). With competitors such as the Nio Onvo L90 BEV (starting at RMB 265,800, 605 km range, and recently refreshed much improved ADAS), the Geely Galaxy M9 EREV (RMB 183,800, with a combined range of 1,500km), the Chery Fulwin T11 EREV (RMB 189,900, combined range 1,400km), the SAIC IM LS8 EREV (RMB 249,800, 1,605 km) and LS9 EREV (RMB 332,800, 1,500km), the GWM Wey Gaoshan 7 EREV (RMB 285,500, combined range 1,000 km, China’s best selling MPV), the Leapmotor D19 BEV / EREV (RMB 219,800, 720km range BEV and combined range 1,300 km [500 km electric]), and the upcoming Voyah Taishan X8 PHEV 5-seat BEV/PHEV (probably starting at around RB 300,000), the VW ID Era 9X will have its work cut out for it.

With such incredible competition, even the BYD Denza brand is struggling to maintain sales; in March it only sold 7,133 vehicles as against over 9,000 in March 2025. Here is the Denza N8L full-sized 6-seat SUV PHEV (starting at RMB 299,800 [US$42,210]), offering excellent value but not as excellent as many of its competitors.

The aggressive pricing of such vehicles as the Leapmotor D19 was most probably behind BYD’s decision to offer the brand new Da Tang (Great Tang) high-end, full-sized Dynasty series flagship 7-seat SUV BEV from only RMB 250,000 (US$34,000) in pre-sale (the final price is generally lower than pre-sale). With a CLTC range from 800km to 950km, 1000 volt flash charging capability, 0-100km/h in 3.9 seconds, air suspension, rear wheel steering and the latest high end BYD ADAS. Why buy the smaller Denza PHEV for RMB 50,000 more? BYD may now have a clash within its own multi-branding differentiation.

The VW ID Era 9X has to be so good that it challenges the need to buy any large Audi SUV, because so many new “affordable” large SUVs have been launched that challenge the quality and equipment levels of more expensive competitors; including the likes of Li Auto, Seres Aito and Xpeng. This has fundamentally reset the quality/functionality/price matrix.

And here is the Zeekr 8X luxury 5-seat EREV SUV, with 0-100km/h in 3.7 seconds, 900 volt architecture, and a CLTC combined range of over 1300 km (battery only of 330km). Starting at RMB 329,800 (US$48,370), which represents a significant reduction from the pre-sales price; reflecting the new price dynamic of the sector. A big problem for the likes of the BMW X5 (starts at RMB 605,000) and the Mercedes GLE (starts at RMB 700,000).

And here is the ROX ADAMAS released at the end of December last year, a large luxury 6 seat EREV SUV, from only RMB 334,900 (US$48,500) to RMB 359,900 (US$52,100). With air suspension, a combined range of 1,405 km CLTC and 0-100km/h in 5.5, seconds. In the video, ROX is seen taking over a bankrupt BMW dealership. For less money than a BMW X3 (compact 5 seat), half the price of an X5 (mid size 5 seat), and a third of the price of an X7 (large 7 seat).

And if that was not enough we have the release of the Xpeng GX large six seat luxury SUV BEV/EREV, with 5C charging and 750 km of range for the BEV, and a combined range of 1,585 km for the EREV (430 km battery only). Competing directly with the likes of the Nio ES8, Li L8 and L9, and the Aito M8. Starting at 399,800 RMB (US$58,620).

If the bigger Chinese large SUV manufacturers are being challenged, the German luxury brands are in very serious trouble with their large SUVs (e.g. the Audi Q9, BMW X5 and X7, the Mercedes GLS, Porsche Cayenne). The entry of Xiaomi into the 5-seat and 7-seat SUV market may be especially troubling, as it may match the sportier feel of the German vehicles at much lower prices. And at the very high end the Yangwang U8 luxury large SUV which gives Bentley a run for its money, from RMB 1,098,000 (US$150,000) to RMB 1,280,000 (US$180,000). The Maybach GLS SUV starts at RMB 1.8 million and the Bentley Bentayga SUV starts at RMB 2.9 million.

And then there is the new Nio ES9 BEV full-sized luxury SUV, with a range of 620 km CLTC and 0-100km/h of 4.3 seconds, offered from RMB 528,000 (US$77,230); continuing Nio’s strategy of offering luxury at significantly lower prices than even recently available from itself. With a price 31% below even the Nio ET9 sedan. A very direct competitor for the likes of the BMW X7 that starts at RMB 928,000 (US$134,500) and the Mercedes GLS that starts from RMB 968,000 (US$140,000). The pricing of the German luxury brands simply no longer makes sense in China, but they have the problem that both the X7 and GLS are made in the US rather than China. Their resulting cost structures are much higher than for the Chinese brand flagship luxury models.

And that’s without the upcoming Xiaomi YU9 and Nio Onvo L80. The up-market, luxury and super-luxury segments are being fundamentally restructured from top to bottom with even some of the top Chinese luxury brands struggling to be successful. The effect on Audi, BMW and Mercedes could be quite devastating this year. And later in the year there will be the new Maextro X6 SUV to challenge the BMW X7, Mercedes GLS and GLS Maybach in the same way that the 7 series and S-Class have been challenged by the S800.

And we see the same trend in the luxury sedan market (over RMB 700,000), the Maextro S800 dominated in January, and still lead the segment in March. The rise of the Nio ET9 and Yangwang U7 is evident, as is the fall of both the BMW 7-Series and Audi A8, but most especially the collapse in Porsche Panamera sales.

• Maextro S800: 2,625 sales (Jan); 807 sales (Mar)

• Mercedes Benz S-Class and S-Class Maybach: 2,045; 1,134

• BMW 7-Series and i7: 1,222; 613

• Audi A8 (globally discontinued): 460; 283

• Nio ET9: 85; 152

• Yangwang U7: 111; 151

• Porsche Panamera: 451; 141

• Porsche Taycan: 37; 25

It must also be remembered that the Yangwang U7 has a starting price of RMB 628,000, the above are only the ones sold for over RMB 700,000. In March, BYD upgraded the U7 with an over 1,000 km (CLTC) range, 0-100km/h in 2.9 seconds (equal to the most expensive Panamera and faster than the Taycan GTS); more power and flash charging with a new base price of RMB 658,000. As of late March, the Xiaomi SU7 has also been significantly refreshed, with 5C super-charging, a range of 835 km (CLTC), 0-100km/h in 2.78 seconds (faster than the most expensive Panamera and Taycan GTS), and a more luxurious cabin and upgraded suspension; for the Max which starts at RMB 309,900. That’s not even the SU7 Ultra that starts at RMB 529,900, with performance that exceeds even the most expensive Taycan. In Q1 of 2026, Porsche sales in China were down 21% y-o-y to only 7,519.

The pricing of the Panamera (starting at RMB 1.13 million), and the Taycan (base price of RMB 928,000) simply does not make sense in China. Even the BYD Denza Z9 GT accelerates faster than the most expensive Panamera, together with having a 1,000 km CLTC range and flash charging, starting from only RMB 269,800.

How exactly does the new Mercedes Benz S-Class Maybach warrant a price of RMB 1,468,000 (US$217,000) to RMB 3,643,000 (US$539,000) vs. RMB 708,000 (US$98,000) to RMB 1,018,000 (US$141,000) for the Maextro S800? As with the flagship German SUVs, the S-Class, 7-series, A8, and Porsche are not made in China, they are all made in Germany. Resulting in their cost base being much higher than for the Chinese brand flagship sedans. In 2026, Maextro will be introducing a higher premium version of the S800, together with an SUV (competing with the Maybach GLS that starts at RMB 2.49 million) and an MPV. In Q1, Mercedes sales in China were down 27% y-o-y (-23% in Asia overall) to 111,525.

Then we have the upcoming YU7 GT to put even more pressure onto the overpriced German luxury brands, most especially Porsche.

Then there is now also the new Geely-Lotus For Me 4-5 seater SUV EREV priced from 508,000 yuan ($73,500); with a pure electric range of 420km CLTC, a combined range of 1,416 km, 0-100km/h in 3.3 seconds, 900-volt architecture and 6C ultra-fast charging. With a much higher quality interior than the likes of Porsche, and engine power that would cost much more from the German makes.

Audi has already responded with the new A6L ICEV sedan priced RMB 122,900 (US$17,780) below the previous version, at RMB 323,000 (US$46,740); after two years of declining sales. Now priced only slightly above the Hongqi H9 competitor, but still well above the BYD Han L and the Xiaomi SU7 (although the SU7 L version may be priced higher). Audi also recently released the new A6L BEV e-tron sedan priced from RMB 313,000 (US$45,340). The Q6L BEV e-tron SUV was launched in August last year priced from RMB 348,800, about the same as the slightly larger Li Auto i8; the latter is selling at a rate more than five times that of the former. In late March, Audi stopped taking orders for the A8 as it is ending its production; exiting the high end luxury sedan market.

The AUDI E5 BEV Sportback has met with very weak sales, only hundreds a month, and the starting price has already been discounted by RMB 30,000 to RMB 205,900 (US$29,800) until at least the end of the first quarter. Audi sales only fell 5% in 2025, but that was because of up to 50% discounts on prices already well below European prices. For example, the Audi A3 ICEV is being sold for the equivalent of US$15,000 in China, and the Q3 BEV e-tron and Q4 BEV e-tron being offered at the equivalent of US$19,000 and US$22,000 respectively. Such low prices and massive discounting accelerates the deterioration of the brand image, as well as delivering profitless sales or even losses. Audi and SAIC recently deepened their collaboration on the expansion of the AUDI brand, with the upcoming AUDI E7X and other models in later years.

The overall VW Audi strategy in China seems to be to throw lots of different approaches at the market and see what sticks, which very much risks a loss of brand cohesion in the eyes the consumer. There is Audi A (sedans), Audi Q (SUVs) and now AUDI (localized electric specific brand), and then there is VW ID, VW ID Unyx, VW ID Era, VW ID Aura and now even a separate Chinese Jetta brand with FAW! With VW ID vehicles now having to provide levels of equipment and luxury which overlap with more expensive Audi/AUDI vehicles.

To put it bluntly:

“The brand equity of the German premium brands in China has disintegrated much faster than anyone expected,” said Matthias Schmidt, an automotive analyst based near Hamburg. “Consumers there are increasingly buying local brands, and there is reasonable concern that those sales will not come back.”

For Audi the China market is nearly as big as the European one, with 38% of its global sales in the country. North America sales are only one third of China’s, and are significantly deteriorating due to the tariff and anti-EV Trump administration policies as well as the general decay of the brand vs. BMW. Can Audi survive if it loses the Chinese market? And of course, the Chinese luxury brands will be increasingly entering the European market. With the split between the US market (ICEV) and the European and Asian markets (increasingly BEV/PHEV), the luxury German manufacturers are having to maintain two completely different drivetrains as they see their sales decline quarter after quarter.

Even Dongfeng Voyah has raised its game with the Tai Shan luxury EREV 6-seat SUV, and below the Passion L luxury EREV sedan. The latter has a 1400km combined range (410km electric only), 0-100km/h in 3.9 seconds, from RMB 279,900 (US$39,630) to RMB 309,900 (US$43,800). Its not a Mercedes S-Class, but its far too close to that level for less than one third of the price. Voyah sales are growing at a rate of over 30% per year.

A Desperate Hyundai-Kia

Hyundai-Kia Chinese sales are abysmal; with a market share of less than 1%. The collapse in Hyundai sales in China over the years:

From CarNewsChina

Given that the Chinese market is so large, and it is the leading market for electric vehicles, H-K can simply not afford to give up its presence in the Chinese market. It plans to lift annual Chinese sales to 500,000 by 2030, a relatively modest target given the scale of the Chinese car market and that the target includes exports from China. In 2025, H-K sold 464,000 vehicles in China when exports of 173,000 are included, so the plan is really about maintaining sales volumes rather than growing sales volumes. To do this it will be releasing 20 new models into the Chinese market over the next five years, with some Chinese-specific such as the new Ioniq V premium large BEV; which uses a platform co-developed with BAIC, batteries from CATL (CLTC range of 600 km), and ADAS from Momenta. Yet another manufacturer putting their badge on what are in reality are Chinese designed and Chinese built, with Chinese components, cars. The Ioniq V will have to be very aggressively priced to have any change of being a success.

With the Chinese brands invading H-K’s other markets outside the US, and even the South Korean home market where Tesla is becoming increasingly successful, strategically H-K must stay and compete in the China market. But in reality, its plans look very modest and seem to rely extremely heavily on Chinese specific vehicles with relatively little actual H-K inside them. And H-K is looking at exporting more cars from China to markets such as the Middle East and Europe, under its slogan “In China, For China, To Global”; a recipe for reduced production within South Korea itself.

Sales Statistics

Overall Vehicle Sales: 1.544 MM (-13.9%); 1.034 MM (-25.4%); 1.648 MM (-15%)

Domestic Brands: 57.5%; 61.2%; 61.8% German Brands: 19.8%; 18.2%; 16%

Japanese Brands: 15.5%; 12.1%; 13.3%. American Brands: 5%; 6.8%; 6.9% (inc. Tesla)

Other (South Korea etc.) Brands: 2.2%; 1.7%; 2%

Exports: 576,000 (+52%); 550,000 (+56%); 695,000 (+74%)

Electric Vehicle Sales: 0.596 MM (-20% & 38.6% share); 0.464 MM (-32% & 45% share); 0.848 MM (-14% & 52% share)

BEV Sales: 348,000 (-17%); 278,000 (-34.9%); 568,000 (-11.7%)

PHEV Sales: 172,000 (-31.2%); 134,000 (-31%); 204,000 (-24.1%)

EREV Sales: 76,000 (+0.8%); 52,000 (-15.6%); 76,000 (-6%)

NEV Exports: 286,000 (+104%); 269,000 (+125%); 349,000 (140%)

Overall Sales By Brand (January, February, March):

1. VW: 221,900 (14.4%); 135,383 (13.1%); 177,434 (10.8%); Q1 548,700 (-14.8%)

   1. Q1: Audi 127,109 (-12%); Porsche 7,519 (-21%); BEV 9,400 (-63.8%)

2. Geely: 209,661 (13.6%); 145,281 (14.1%); 171,337 (10.4%); Q1 526,279 (-14.3%)

3. BYD: 94,176 (6.1%); 88,697 (8.6%); 194,131 (11.8%); Q1 377,004 (-51.7%)

4. Toyota (incl. Lexus): 145,400 (9.4%); 82,500 (8%); 142,700 (8.7%); Q1 370,600 (-4%)

5. Changan: 81,074 (5.3%); 75,000 est. (7.4%); 111,675 (6.8%); Q1 267,749 (-8.7%)

6. Chery: 78,079 (5.1%); 44,040 (4.3%); 70,411 (4.3%); Q1 192,530 (-47.2%)

7. Great Wall Motor: 50,034 (3.2%); 29,919 (2.9%); 59,198 (3.6%); Q1 139,151 (-16.2%)

8. SAIC-GM-Wuling: 30,000 est. (1.9%); 25,000 est. (2.4%); 52,215 (3.2%); Q1 127,249 (-53.5%)

9. Honda: 57,489 (3.7%); 28,780 (2.8%); 36,201 (2.2%); Q1 122,470 (-22.4%)

10. Nissan: 50,024 (3.2%); 25,391 (2.5%); 42,400 (2.6%); Q1 117,800 (+5.5%)

11. BMW: 50,504 (3.3%); 32,415 (3.1%); 45,000 (2.7%); Q1 127,919 (-17.6%)

12. GM: 43,502 (2.8%); 27,782 (2.7%); 50,022 (3%): Q1 121,306 (+14.2%)

13. Tesla: 18,485 (1.2%); 38,206 (3.7%); 56,107 (3.4%); Q1 112,798 (-16.4%)

14. HIMA: 57,915 (3.7%); 28,212 (2.7%); 26,582 (1.6%); Q1 112,709 (+6.6%)

15. Mercedes: 46,989 (3%); 18,649 (1.8%); 45,887 (2.8%); Q1: 111,525 (-27%)

16. Li Auto: 27,668 (1.8%); 26,421 (2.6%); 41,053 (2.5%); Q1 95,142 (-31.2%)

17. Nio: 27,061 (1.8%); 20,700 (2%); 35,383 (2.1%); Q1 83,194 (+70%)

18. Xiaomi: 39,002 (2.5%); 20,414 (2.1%); 21,440 (1.3%); Q1 80,856 (+108%)

19. GAC Aion: 21,297 (1.4%); 17,000 est. (1.6%); 33,044 (2%); Q1 71,341 (+2.9%)

20. Dongfeng: 22,035 (1.4%); 18,000 est. (1.7%); 28,998 (1.8%); Q1 69,033 (-22.5%)

21. Leapmotor: 17,536 (1.1%); 15,000 est. (1.5%); 33,420 (2%); Q1 65,956 (-24.7%)

22. Xpeng: 16,807 est. (1.1%); 11,608 (1.1%); 22,710 (1.4%); Q1 51,125 (+10%)

23. Ford (incl. Lincoln): 18,130 (1.2%); 16,280 (1.6%); 16,126 (1%); Q1 50,536 (-43%)

24. Hyundai-Kia: Q1 32,000 (-8%)

Electric Vehicle Sales By Brand (January, February, March):

Below accounts for 93% of all EV sales.

1. BYD: 94,176 (15.8%); 88,697 (19.1%); 194,131 (22.9%); Q1 377,004 (down 51.7%)

2. Geely: 92,135 (15.4%); 76,636 (16.5%); 96,842 (11.4%); Q1 265,613 (down 20.9%)

3. Changan: 31,122 (5.2%); 28,220* (6.1%); 64,439 (7.6%); Q1 123,781 (down 21.3%)

4. Tesla: 18,485 (3.1%); 38,206 (8.2%); 56,107 (6.6%); Q1 112,798 (down 16.4%)

5. HIMA: 57,915 (9.7%); 28,212 (6.1%); 26,582 (3.1%); Q1 112,709 (up 6.6%)

6. Li Auto: 27,668 (4.6%); 26,421 (5.7%); 41,053 (4.8%); Q1 95,142 (down 31.2%)

7. Nio: 27,061 (4.5%); 20,750 (4.5%); 35,383 (4.2%); Q1 83,194 (up 70%)

8. Xiaomi: 39,002 (6.5%); 20,414 (4.4%); 21,440 (2.5%): Q1 80,856 (up 108%)

9. SGMW: 20,996 (3.5%); 16,000 est. (3.5%); 40,441 (4.8%); Q1 77,437 (down 35.5%)

10. GAC Aion: 21,297 (3.6%); 17,000 est. (3.7%); 33,044 (3.9%); Q1 71,341 (up 2.9%)

11. Dongfeng: 22,035 (3.7%); 18,000 est. (3.9%); 28,998 (3.4%); Q1 69,033 (down 22.5%)

12. Leapmotor: 17,536 (3%); 15,000 est. (3.2%); 33,420 (3.9%); Q1 65,956 (down 24.7%)

13. Chery: 19,000 est. (3.2%); 15,000 est. (3.2%); 22,905 (2.7%); Q1 56,905 (down 52%)

14. Xpeng: 16,807 (2.9%); 11,608 (2.5%); 22,710 (2.7%); Q1 51,125 (up 10%)

15. Great Wall Motor: 16,000 est. (2%); 12,000 est. (2.6%); 19,000 est. (2.2%); Q1 47,000 (down 24.9%)

16. SAIC Motor Passenger Vehicle (SMPV): 14,000 est. (2.3%); 11,000 est. (2.4%); 21,317 (2.5%); Q1 46,317 (n/a)

17. Arcfox Jihu: 5,077 (0.9%); 4,000 est. (0.9%); 9,000 (1.1%); Q1 18,077 (n/a)

India

Overall Vehicle Sales (wholesale): 452,589 (+12.7%); 420,613 (+10.5%); 447,702 (+16%)

March:

1. Maruti Suzuki: 166,219 (+10.3%)

2. Hyundai-Kia: 84,176 (+10%)

3. Tata: 66,192 (+28.2%)

4. Mahindra: 60,272 (+25.4%)

5. Toyota: 35,168 (+23.9%)

6. Skoda 7,928 (+6.8%)

7. Honda: 7,585 (+4.9%)

8. SAIC-MG: 6,528 (+18.7%)

This market is overwhelmingly ICEV based. SAIC owned MG Motor gained 71,000 sales in 2025, and BYD 5,400. The latter has experienced many problems attempting to set up full scale manufacturing facilities in India. Hyundai-Kia benefits greatly from the obstacles put in the way of Chinese brand entry into the Indian market.

Australia

In Australia, the Chinese brands are in the process of supplanting both the Japanese brands and Tesla. Toyota, Mazda, Mitsubishi, Subaru and Nissan are all seeing double digit year over year sales declines as BYD, Chery and GWM continue to grow rapidly, and the likes of Geely are entering the market with a bang. Only SAIC-MG is having difficulties as the other Chinese brands ramp up the competition. China became the biggest source of car imports for the first time in February.

Tesla sales recovered somewhat in February and March, but as we can see from the following comparison even the Tesla Model Y L is outshone by the BYD Sealion 8. And that is before the availability of upgraded BYD models with bigger batteries and faster charging. We also have to remember that Q1 last year was the height of the “Nazi Musk” optics. In March, Tesla sales only increased 23.2% from that low point; well below the overall jump of 88.9% in BEV sales.

Overall Vehicle Sales: 87,753 (+0.1%); 94,131 (-2.7%); 108,703 (-2.6%)

BEV: 7,409 (+93.3%); 11,134 (+96%); 15,839 (+88.9%)

Chinese Sourced: 24%; 27.4%; 28.5%

1. Toyota 15,165 (-22.3%); 14,459 (-27.8%); 17,700 (-19.3%)

2. Hyundai-Kia 12,456 (+11%); 12,976 (+2.3%); 14,299 (+1.2%)

3. BYD 5,001 (+641%); 5,323 (+62.2%); 7,217 (+50%)

4. Mazda 7,692 (-7.6%); 7,042 (-19.9%); 7,156 (-10.5%)

5. Ford 6,116 (-10.5%); 6,907 (+9%); 7,149 (-13.2%)

6. GWM 4,509 (+31.3%); 4,689 (+24.9%); 5,680 (+29.3%)

7. Chery 4,471 (+125%); 4,713 (+120%); 5,110 (+104%)

8. Mitsubishi 4,347 (-23.5%); 4,755 (-22.3%); 5,001 (-31.2%)

9. SAIC-MG 3,123 (-16.5%); 3,254 (-13%); 4,218 (+7.4%)

10. Nissan 1,871 (-38.4%); 1,775 (-50.1%); 3,715 (-8.9%)

11. Isuzu Ute 2,929 (-16.5%); 3,384 (+23.7%); 3,525 (+0.5%)

12. Tesla 501 (-32.2%); 3,274 (+105.7%); 3,485 (+23.2%)

13. Geely 1,765 (new); 2,325 (new); 2,837 (+530%)

14. VW 1,886 (-18.5%); 2,139 (-2.1%); 2,812 (-30%)

15. Subaru 2,336 (-20.1%); 2,656 (-24.4%); 2,691 (-16%)

16. BMW 2,154 (+53.7%); 1,602 (-9.5%); 2,430 (-1%)

17. Mercedes 2,149 (+22.4%); 2,143 (+8.8%); 1,813 (-11%)

Below is the 2026 Melbourne Auto Show, with a plethora of new Chinese models coming to Australia, by the end of this year will Chinese sourced vehicles be approaching 40% of the Australian market? With the Japanese brands taking the biggest hits to their sales?

In response, the Japanese brands are starting to leverage their Chinese-built vehicles with extremely competitive pricing. Below, the Mazda CX-6e mid-sized SUV BEV/PHEV (made by Changan-Mazda, a rebadged Deepal S07) priced from the equivalent of US$27,000. The Japanese brands will increasingly serve the Asia market with Chinese-made vehicles, many not much more than re-badged Chinese brand cars and others using very significant amounts of Chinese brand technology, architecture and design. Such cars are also being introduced to the European market, in effect moving Japanese brand production from Japan (and Thailand) to China.

Malaysia

Overall Car Sales: 60,369 (+28%); 52,414 (-19%); 67,846 (-12%)

January; February; March

1. Perudoa (Isuzu) 26,128; 23,575; 24,530

2. Geely (Proton+Zeekr) 19,750; 13,447; 15,420

3. Toyota (incl. Lexus) 7,005; 7,430; 9,117

4. Honda 3,177; 3,379; 7,062

5. Chery (incl. Jetour and iCaur) 3,561; 2,430; 3,433

6. Mitsubishi 1,191; 889; 981

7. Mazda 841; 444; 1,054

8. BYD 913; 469; 879

9. Mercedes 677; 659; 727

10. BMW 545; 449; 672

11. GWM 425; 347; 522

12. Nissan 336; 239; 585

13. Ford 341; 256; 276

14. Isuzu 261; 527; 272

15. Tesla 176; 144; 338

Thailand

Overall Car Sales: 89,864 (+41.3%); 48,242 (-1.7%); n/a (n/a%)

BEV: 32,530 (+163%); 6,168 (-19%); n/a (n/a%)

January; February; March

1. Toyota 26.2%; 39.2%; n/a

2. BYD 14.6%; 0.6%; n/a

3. Chery 9.3%; 1.8%; n/a

4. Honda 9.1%; 14.9%; n/a

5. Isuzu 7.6%; 12.9%; n/a

6. SAIC-MG 6.5%; 1.9%; n/a

7. GAC Aion 6.2%; n/a; n/a

8. Changan 4.3%; 1.3%

9. Great Wall Motor 4.2%; 2.3%;

10. Mitsubishi 2.8%; 4.3%;

With the removal of EV incentives in February, EV and BEV sales collapsed from their inflated January levels; greatly impacting Chinese brand sales.

Indonesia

Overall Car Sales: 66,447 (+7%); 78,219 (+11.9%); 66,637 (-13.2%)

The market is dominated by Toyota and Daihatsu, but their combined market share has fallen below 50% as the Chinese brands (BYD and Chery) gain; with BYD now in the #6 spot with Chery #7. Mitsubishi, Isuzu and Suzuki also have significant sales in Indonesia. A great opportunity for the Chinese brands to take a large amount of sales away from the Japanese brands.

Japan

Overall Car Sales: 367,748 (-2.3%); 394,965 (-3.5%); 490,640 (-1.8%)

Foreign brands hold just 5% of the market and BEV sales are minimal. BYD has established sales channels in Japan, and is working to slowly grow its presence. The market is in a long term decline due to the negative demographics of Japan.

South Korea

Overall Car Sales (domestic producers): 99,495 (+9.5%); 95,719 (-14.8%); 130,377 (+5.3%). Dominated by Hyundai-Kia. Foreign Brands: 20,951 (+37.6%); 27,155 (+34.6%); 33,970 (+34.6%) are gaining market share in the Hyundai-Kia home market, driven mainly by Tesla: 1,966 (+39,220%); 7,868 (+254%); 11,134 (+330%) and BYD 1,347 (new); 957 (new); 1,664 (new).