In the eyes of many automobile practitioners, this year's traditional peak season of "Golden Nine and Silver Ten" has made people feel a little bit cool.
Taking October 1st to 11th as an example, statistics from the Passenger Car Market Information Joint Branch of the China Automobile Dealers Association show that the national retail sales of passenger cars were 459,000, a year-on-year decrease of 24%, and nearly 150,000 less than the same period in 2025.
Li Hong (pseudonym), the sales manager of a domestic brand 4S store in Chaoyang District, Beijing, told reporters that during the National Day, the number of consumers entering the store was 30% more than usual. "However, the order signing rate has obviously dropped. The customer sat for half an hour, asked about the price, added WeChat, and left." The situation of a joint venture brand 4S next door is even more bleak. Sales consultant Ms. Zhang said that the terminal discount given by the manufacturer is nearly 20,000 yuan more than that at the end of 2025, but the first thing people who come to see the car ask is "can the price be lowered?"
If you raise your perspective, you will find that China's automobile industry is undergoing a "shift." In September, domestic car sales were 1.904 million units, a year-on-year decrease of 26%; exports during the same period were 1.053 million units, a year-on-year increase of 61.4%. Between the decline and the rise, an old cycle with domestic market growth as the core driving force is ebbing, and a new cycle with globalization capabilities, technological depth and system efficiency as the yardstick is emerging. The labor pains are real, but the direction is equally clear.
"Price exchanges space", how long can the exchange last?
Chen Fujian (pseudonym), who works in Shanghai, recently plans to buy a new energy vehicle with a budget of about 150,000 yuan. In two months, he test-drove six or seven brands including BYD, Geely, Leapmoon, and Xpeng, and stored the WeChat messages of more than a dozen sales consultants on his phone. "There are so many cars, and the discounts are so great. Some models, including replacement subsidies and financial policies, are more than 20,000 yuan cheaper than at the beginning of the year."
But Xiao Chen never placed an order. "Every time I think it's almost time to make a purchase, but two weeks later the sales department will send a message saying that new benefits are coming, or a brand next to it has released a new model with higher configuration and lower price. After seeing too much, I don't know how to choose, and I am always afraid of regretting it after buying it."
Xiao Chen’s dilemma is not an exception. On multiple car forums and social platforms, posts such as "The budget of XX million is getting more and more confusing" and "Will it be cheaper by the end of the year?" The popularity remains high. The vast supply of vehicle models and the continued increase in terminal discounts should have been a boon to stimulating consumption, but instead they have given rise to "choice overload" and "wait-and-see inertia" among some consumers. A joint venture brand sales manager said frankly that the most difficult thing about selling cars now is not price negotiation, but helping customers make up their mind. "Customers are not afraid of the price, but they are afraid of making the wrong choice or losing money."
This wait-and-see mood at the micro level echoes the trend of macro data. Cui Dongshu, secretary-general of the Passenger Car Association, shared a set of data: from January to September this year, the automobile industry’s revenue was 8,043.5 billion yuan, a year-on-year increase of 2.6%; profit was 267.5 billion yuan, a year-on-year decrease of 23%; and sales profit margin was only 3.3%. In September, the single-month profit margin further dropped to 1.4%, and the profit of 14.2 billion yuan plummeted 68% year-on-year, reaching a low level in the past four years. The gross profit of bicycles in the industry chain dropped to 11,000 yuan (calculated based on the output caliber of the National Bureau of Statistics), a year-on-year decrease of 21%.
"Revenue is still increasing slightly, but profits are shrinking rapidly, which shows that the industry is exchanging price for space, but the space gained is becoming increasingly limited." Cui Dongshu said that the profit margin of the automobile industry has been declining step by step for three consecutive years - 4.3% in 2024, 4.1% in 2025, and 3.3% in the first nine months of this year. The gap with the average level of 5.68% for industrial enterprises above designated size is more than 2%.
In addition to price fluctuations leading to a continued decrease in bicycle gross profit, another variable that exacerbates market complexity is the acceleration of the pace of product iteration. Automobile industry analyst Liu Zhichao bluntly said that some companies have compressed the research and development cycle to a level well below the industry safety threshold to seize the window period with "crash cars". This short-term behavior distorts the order of competition and allows consumers to bear hidden risks under the surface of "new cars emerging one after another".
However, regulatory authorities have already taken action to combat the above-mentioned phenomena. At the end of August, four departments including the Ministry of Industry and Information Technology launched a one-year special action to improve production consistency and quality; on October 10, a further draft was released for comments, clarifying that new cars must complete the "two winters and one summer" environmental adaptability test and at least 30,000 kilometers of reliability verification before being launched on the market. Designs that have not been fully verified, such as fully hidden door handles, are prohibited. Industry analysts pointed out that the purpose of supervision is not to suppress innovation, but to bring competition back to the track where safety and quality are the bottom line.
Knockout rounds changed from "early warning" to "reality"
When profit margins continue to be compressed and regulatory thresholds are substantially raised, the industry is diverging faster than most people expected. Cui Dongshu’s judgment is that the current auto market has “prominent stock competition characteristics” and the new energy market has “farewelled to global growth”, showing a polarization of “the explosion of high-end electric vehicles and the pressure on micro electric vehicles.”
At the same time, the pressure on the channel side is more intuitive. The auto dealer inventory warning index in October was 62.2%, which was above the boom-bust line. New car sales generally suffered losses, and the price inversion has not yet improved significantly. This means that some dealers are using profits from after-sales and financial services to subsidize losses in new car sales. This model is difficult to sustain in the long term.
"It is foreseeable that in the future, brand exits, channel integration, and production capacity optimization will no longer be "incidental events" in the news, but will become the norm for the industry to clear out." Liu Zhichao analyzed: "But clearing out does not mean shrinking. A more concentrated and healthier competition pattern is precisely the necessary stage for the industry to move from "more and scattered" to "fewer and stronger."
Faced with the wait-and-see sentiment on the demand side, various regions are using scenario innovations such as "auto + cultural tourism" to activate consumption. The Wuhan International Auto Show connects ticket stubs with the Yellow Crane Tower, Liangjiang Cruises, and special hotels and B&Bs. One ticket stub connects exhibition viewing, tourism and consumption; the new energy vehicles going to the countryside activity combines exhibition and sales with local cultural and tourism resources to explore the sinking path of "gathering popularity with culture and driving consumption with scenes". The old-for-new policy continues to play a supporting role, driving sales of related categories to exceed 2 trillion yuan this year, benefiting more than 250 million people. When incremental dividends weaken, using scenarios and services to create new reasons for consumption may reverse the passive situation of "solely relying on price cuts to promote sales."
Find growth from overseas and technology depth
The real structural opportunities for China's automobile industry are unfolding in the depth of global market and technology.
Data is the most intuitive footnote. In the first three quarters of this year, my country exported 8.205 million complete vehicles, a year-on-year increase of 65.8%. Among them, 4.006 million new energy vehicles were exported, a year-on-year increase of 127.9%. At the recently held Automobile Industry Overseas Model Innovation and Development Conference, Sun Xiaohong, former secretary-general of the Automobile Branch of the China Chamber of Commerce for Import and Export of Machinery and Electronic Products, said that China’s automobile exports ranked second in the world in terms of value, surpassing Japan and second only to Germany.
During the "14th Five-Year Plan" period, Chinese automobiles completed their "going out" strategy—export sales jumped from 1 million units to 8 million units, and new energy and intelligent connected products gained global industry recognition. But Sun Xiaohong judged that the focus of the "15th Five-Year Plan" will shift to "going in": summed up in six words: "Stand and come back." To be able to stand, the market that has been developed must be defended, and the entire industrial chain must go out; to be able to recover, overseas profits must be returned to the country, forming a closed loop with R&D investment.
The depth of regional layout also determines the quality of "getting down". Chen Weili, director of the Guangzhou Office of the Thailand Investment Promotion Board, introduced at the event that Thailand is relying on its mature automobile manufacturing foundation and supply chain to become an important pivot for Chinese automobile companies to enter the ASEAN market. BYD, Changan, GAC Aian, Great Wall, Chery and other Chinese car companies have already established their presence in Thailand. Thailand's BOI provides incentives for the entire value chain of electric vehicles, covering complete vehicles, batteries, core components and charging infrastructure. Qualifying projects can enjoy corporate income tax exemptions for 3 to 13 years.
On the product side, in September, Chery ranked first in exports with 203,700 units, with a share of 22.2%, which is equivalent to one out of every five exported passenger cars from Chery; Leapmotor exports in September increased by 50% month-on-month. 4%, a year-on-year increase of 298.6%; Ji Krypton delivered 32,400 new cars in October. The price of the 9X in Europe is equivalent to more than 1 million yuan. It is the first Chinese car to establish a stable price in the million-level locally and achieve large-scale sales. It is reported that about 700 9Xs are being shipped to Europe, and delivery is expected to begin in January 2027.
On a technical level, this year is also a critical node. All-solid-state batteries have entered the pilot stage, the penetration rate of L2-level assisted driving is expected to exceed 70%, and mainstream models priced at 150,000 yuan are beginning to be commonly equipped with high-speed and urban NOA functions. This means that intelligence is no longer an exclusive label for high-end models, but is becoming a standard feature of mainstream products.
“This year’s Chinese auto market is not getting worse, but growing in a different way. "As Liu Zhichao said, contraction of profit margins, tightening of supervision, and acceleration of differentiation are all frictions that will inevitably accompany the exit of the old model. The real opportunities belong to those companies that have completed capability upgrades amidst friction. Ensure safety verification, reduce technology costs, and build overseas systems. After the growth rate shifts, only those who run more steadily will be qualified to run further.
