China Faces Surplus of 880,000 Unsold Electric Cars Amid Falling Demand
Meanwhile, factories continue to produce new vehicles to meet production targets.
The Chinese electric vehicle and hybrid market continues to shrink, despite the traditionally high autumn demand. According to the China Passenger Car Association, from October 1 to 25, 2026, 753,000 new energy vehicles were sold in the country — a 13% decrease compared to the same period in 2025.
Since the beginning of the year, Chinese buyers have purchased 8.51 million electric vehicles and hybrids — also a 13% decrease from last year's figures. The share of hybrids and electric vehicles in retail sales of passenger cars for the first 25 days of October was 65.7%, down from a record 67% in September.
Read this article in full and everything else in Telegram, ad-free
Open in TelegramThanks, I just want to finish reading here
According to forecasts, October will end with approximately 1.07 million electrified vehicles sold, corresponding to a 16.5% annual decline. September has already marked the ninth consecutive month of decline for hybrids and electric vehicles in China, and October may extend this streak to ten months.
With weak demand, automakers continue to increase shipments of electrified vehicles. In the first 25 days of October, they shipped 1.008 million electric vehicles and hybrids, a 3% increase over last year's results, indicating a stockpiling of inventory.
By the end of September, Chinese manufacturers specializing in electrified vehicles had accumulated 880,000 unsold cars; over the month, stocks increased by 30,000 vehicles. Meanwhile, factories are forced to maintain stable production volumes to meet targets and ensure the uninterrupted operation of component suppliers.
A potential boost for electric vehicle manufacturers may come from the decreasing cost of batteries. The Association notes a sharp decline in the price of lithium carbonate used in battery production.
Another factor will be exports: expected changes in tax incentives and possible tightening of trade restrictions in 2027 may compel Chinese companies to increase overseas shipments.
