China’s automotive landscape underwent a significant transformation in 2024, marked by a remarkable surge in electric vehicle (EV) sales while traditional gasoline and diesel-powered car sales plummeted. The country recorded total vehicle sales of 31.4 million units last year, reflecting a 4.5% increase compared to 2023. However, the sales of conventional fuel-powered vehicles saw a drastic decline of 17%, indicating a shift in consumer preference towards greener alternatives.
According to the China Association of Automobile Manufacturers, the trend toward electric vehicles has gathered momentum, with sales of all types of electric vehicles rising over 40% throughout the year. This growth is attributed partly to incentives such as rebates for trade-ins, which have encouraged consumers to opt for newer, more environmentally friendly models. In December alone, passenger car sales surged by 13.6%, contributing to an annual total of 22.6 million passenger cars sold — a 3.1% increase from the previous year. Notably, passenger cars represented 51% of all new car sales in the country.
The rise of plug-in hybrids was particularly notable, as these vehicles saw the most rapid growth among the EV segment in 2024. The automotive industry is also experiencing a boom in exports, with "new energy vehicles" reaching an export figure of 1.28 million units. Overall, China's passenger car exports jumped nearly 20% to almost 5 million vehicles last year, showcasing the nation's increasing competitiveness in the global automotive market.
Despite a general increase in vehicle production by 3.7%, the demand for gasoline-powered automobiles faltered significantly, challenging foreign automakers like Volkswagen AG and Nissan Motor Corp. who are struggling to adapt to this evolving market landscape. In response to this shifting dynamic, Honda and Nissan recently announced plans to pursue a merger aimed at countering the challenges posed by the rising dominance of China's EV manufacturers.
The statistics underscore a pivotal moment in the automotive sector, where consumer preferences are increasingly aligning with sustainability and innovation. The strong performance of electric vehicles not only reflects changing consumer habits but also highlights the urgency for traditional automakers to pivot towards electric offerings to remain competitive.
