A new industry report released Monday shows China made big strides last year toward an EV-driven future, as domestic sales of all types of electric vehicles rose by 40% in 2024. Sales of gasoline powered cars tumbled, including foreign imports.
In 2024, a total of 31.4 million total vehicles were sold in the world’s largest automobile market by sales, according to the China Association of Automobile Manufacturers. That marked a 4.5% rise compared with the previous year.
Despite the uptick in sales, foreign automobile importers are increasingly finding it hard to compete with local brands in China who have been offering a wide variety of affordable EVs and intensified market competition.
One example is German luxury car maker Porsche, who closed several of its physical stores in China in 2024. Porsche sales in China were down 29% year on year which marked the third consecutive year of decline.
In addition to Porsche, luxury carmakers BMW, Mercedes, and Audi each saw a drop in their vehicle sales in China in 2024 with BMW sales falling 13.4%, Mercedes sales by 7%, and Audi sales by 11%.
Tai Chih-yen, an associate researcher at the Chung-Hua Institution for Economic Research in Taipei told VOA’s Mandarin service that a sense of patriotism and support for national brands has created additional pressures that have contributed to the struggles international automakers are facing.
“Higher-end consumers have started to abandon foreign brands and are turning to comparatively better priced high-end domestic cars,” Tai told VOA. “This is not a so-called consumption downgrade, but more a reflection of the current situation, where many are choosing to be more discreet [in the kinds of cars they drive] and show their patriotism by driving domestic luxury brands.”
The industry report also noted that sales of traditional gasoline and diesel-powered vehicles in China sank 17% in 2024, from 14 million to 11.6 million, a slide that coincides with Beijing’s focus on transitioning to electric vehicles.
At the same time, Chinese vehicle exports were up 19.3% in 2024, according to the report. However, export growth is expected to cool with the report estimating only a 5.8% increase in 2025.
China faced a backlash in 2024 as it moved to expand EV sales overseas, with the U.S., Canada and EU unveiling steep tariffs to stop a flood of cheap electric vehicles into their markets. The U.S., Canada and EU have raised concerns about subsidies that the Chinese government provides EV makers that allows them to sell their cars for lower prices.
They have also voiced concerned that China has too much production of EVs and that cars are being dumped into foreign markets, allegations that Beijing has repeatedly denied.
China argues that its EV subsidies are similar to those of other countries and that sales of electric vehicles help with climate change. China has filed a complaint at the World Trade Organization over the EU’s tariff decision.
Michael Baturin and VOA Mandarin Service reporter Nai-chuan Lin contributed to this report. Some information came from Reuters.
