China’s electric vehicle (EV) market is expected to witness a pivotal shift in 2024, as EV sales outpace those of traditional internal combustion engine (ICE) cars for the first time, according to data from multiple industry sources including UBS, HSBC, Morningstar, and Wood Mackenzie.
The projected annual sales of EVs, forecast to exceed 12 million units by 2025, mark a significant leap from the 5.9 million recorded in 2022 and underscore China’s rapid transition toward cleaner and more advanced mobility solutions.
Near-Doubling of EV Sales
The reports indicate that China’s EV sector will continue to grow robustly—by around 20% year-on-year by 2025, and nearly 40% in 2024 alone—driven by government incentives, ongoing technological innovation, and shifting consumer preferences.
This expansion is expected to elevate total EV sales to over 12 million units by 2025, more than double the 2022 figure.
In contrast, sales of traditional ICE vehicles are anticipated to slide by over 10%, dipping below 11 million units in 2024—down nearly 30% from the 14.8 million sold in 2022.
Observers note this trend highlights a turning point for the world’s largest automotive market, where consumers are increasingly choosing electric over gasoline-fueled models.
Foreign Brands Losing Market Share
According to Shanghai-based consulting firm Automobility, foreign automakers have seen their market share plummet from 64% in 2020 to a new low of 37%.
Analysts attribute this decline to the growing competitiveness of domestic brands, which have capitalized on consumer preferences for tech-savvy vehicles and cost-effective alternatives.
The steep drop in foreign market share underscores the intense competition in China’s EV space. Multinational manufacturers are racing to strengthen their foothold through partnerships, local research and development centers, and region-specific marketing campaigns.
Strategic Importance Amid Fierce Competition
Industry experts describe the EV sector as “strategically important” for China’s emerging high-tech economy, citing its potential to create new jobs, spur innovation, and reduce the country’s carbon footprint.
Yet the market’s rapid expansion also brings challenges, including concerns about excess production capacity, pricing pressures, and the long-term sustainability of government subsidies.
Market observers predict further consolidation in the coming years, as companies unable to keep pace with research and development demands—particularly in battery technology—may be forced out.
Despite these hurdles, the combination of government policies and consumer enthusiasm for EVs is expected to maintain China’s position as one of the leading global markets for electric mobility.