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As Chinese automakers surpass Japan in global sales, EV exports accelerated and the sector is supported by 2026 trade-in incentives
December 30, 2025
As China’s electric vehicle (EV) and auto sector heads into the end of 2025, it has gained strong momentum in both global sales and exports. According to a study compiled by Nikkei using automaker statements and S&P Global Mobility data, Chinese automakers quickly moved ahead of Japanese manufacturers and reached the leading sales volume globally. The study stated that global sales of China-origin vehicles are expected to rise 17% in 2025 to about 27 million units, and about three quarters of sales came from the domestic market thanks to heavy EV and plug-in hybrid incentives. Japanese vehicle sales are expected to stay flat around 25 million in 2025. The same report said the U.S. is heading toward its best year since 2019 with about 16.3 million units sold in 2025.

On the export side, record growth also stood out. According to China Customs data, China’s EV exports rose 87% year over year in November to 199,836 units. In the regional breakdown, Asia was the largest importer with 110,061 units (71% year over year increase), while Europe stood out with 42,927 units (63% increase) and Latin America and the Caribbean with 35,182 units (283% increase). The most striking jump was seen on the Mexico route. China’s EV exports to Mexico in November rose 2,367% year over year to 19,344 units. China’s EV shipments to the European Union were also recorded at 25,792 units with a 39% year over year increase.

Despite this, it is stated that tariffs in Europe are pressuring Chinese EV sales, and manufacturers are increasing tariff-exempt hybrid production to reduce this effect. Chinese brands are also seen gaining share in markets where Japanese manufacturers have traditionally been strong. According to the Nikkei study, Chinese auto sales in Southeast Asia are expected to rise as much as 49% in some countries including Thailand. In Thailand, the share of Japanese vehicles in new vehicle sales is projected to fall from 90% in 2020 to 69% in 2025.

A new support package from Beijing stood out as an element strengthening the 2026 outlook. China’s National Development and Reform Commission (NDRC) announced that it will provide consumers with RMB 62.5 billion ($8.92 billion) in trade-in subsidies in 2026 to stimulate the economy. It was noted that the program is part of the effort to mitigate the impact of weakness in the housing market and ongoing deflation pressure. It was stated that the NDRC and China’s Ministry of Finance will issue ultra-long-term special treasury bonds to finance the program. According to Bloomberg, the NDRC allocated $42.8 billion in subsidies in 2025 to support purchases of various consumer goods including cars, smartphones, and home appliances. This figure is at twice the level compared to 2024.

On the sector side, companies such as BYD, NIO, Li Auto, XPeng, and Geely continue both to maintain EV dominance in China’s domestic market and to keep increasing share in Asia and Europe. It is stated that in the internal combustion engine (ICE) segment, brands such as MG owned by SAIC Motor, Jaecoo, and Leapmotor are accelerating overseas adoption through competitive pricing, technology, and production strategies aimed at limiting the tariff impact.