China Auto Association Warns of Weak Domestic Demand
The China Association of Automobile Manufacturers reports that domestic car demand fell 20.4 percent in May and will likely remain under pressure throughout 2026. While total vehicle sales dropped 2.1 percent, a 68.7 percent jump in exports continues to offset the weakness in the domestic market.
China saw domestic vehicle sales slide 20.4% in May as consumer demand fell sharper than industry forecasts. Total vehicle sales dropped 2.1% during the same period despite a surge in overseas shipments. Investors must weigh whether record export growth can offset a deepening multi-year slump in the world's largest car market.
Domestic demand will likely remain under heavy pressure throughout 2026, according to the China Association of Automobile Manufacturers (CAAM). Chen Shihua, deputy secretary-general of CAAM, said stabilizing internal demand is now a very important task for the industry.
