BEIJING (Reuters) – China’s car sales accelerated in September, the traditional peak season for the auto market, as dealers and consumers took advantage of trade-in subsidies before more local governments suspended the incentives.
Domestic auto sales rose 6.6% year-on-year to 2.27 million units, following a 4.9% rise in August, data from the China Passenger Car Association (CPCA) showed on Monday.
Sales of electric vehicles and hybrid cars represented 57.2% of total sales and grew 15.5%, compared to 7.5% in August.
This time of year, known as “Golden September” in China, is typically peak season, as automakers rush to launch new models and consumers return to showrooms after a hiatus during the sweltering summer months.
Local government-subsidized trade-ins boosted car sales in the first half, but are showing signs of slowing due to funding shortages.
The eastern province of Jiangsu and the southwestern region of Guangxi were among those that announced last month they would suspend local car replacement subsidy programs. More cities such as Wenzhou and Hangzhou in eastern China’s Zhejiang province joined the suspension this month.
The sales growth also came as dealers purchased more inventory last month. Data from the China Automobile Dealers Association showed dealers had a total of 3.04 million car units in their inventory at the end of September, up from 2.6 million a month ago.
Cui Dongshu, secretary-general of the CPCA, last week called for financial policies to support dealers who have been suffering widespread losses on new car sales, while automakers continued to offload inventory to them despite tepid demand.
Top player BYD last month recorded the first monthly drop in auto sales since February 2024, along with a further production cut. BYD’s sales in its domestic market accounted for 14% of China’s domestic auto sales in September, compared with 18% in the same period in 2024.
Smaller domestic rivals including Geely, Leapmotor, Xpeng and Xiaomi overtook BYD with record sales last month.
Tesla, which exported 19,287 Chinese-made electric vehicles in September, saw its sales in China fall 0.9% from a year earlier, extending a streak of losses into the third month.
China’s auto export growth rose to 20.7% from 20.2% in August, CPCA data showed.
(Reporting by Qiaoyi Li, Zhang Yan and Brenda Goh; Editing by Tom Hogue and Kate Mayberry)