- China's NEV retail sales in March are expected to nearly double from February's trough, with the penetration rate returning above 50%.
- NEV sales plunged 32.0% year-on-year in February due to a later Chinese New Year holiday and the scaling back of support policies.
China's retail sales of new energy vehicles (NEVs) are expected to record a significant rebound in March as the impact of the Chinese New Year holiday fades.
NEV retail sales will reach around 900,000 units this month, according to preliminary estimates by the China Passenger Car Association (CPCA) on Friday.
The figure represents a sharp recovery from February's sluggish performance, translating to a month-on-month surge of about 94%.
In February, China's NEV retail sales experienced a 32.0% year-on-year decline, logging just 464,000 units. This was primarily hit by the extended Chinese New Year holiday from February 15 to February 23.
In addition, the scaling back of China's NEV support policies heading into 2026 also took a toll on last month's sales performance.
The broader passenger car market also faced immense pressure in February, with overall retail sales dropping 25.4% to 1,034,000 units.
Consumers' wait-and-see sentiment is expected to ease as detailed rules for trade-in subsidies are rolled out across various regions in mid-to-late March.
The intensive launch of new models ahead of the spring auto shows has also provided strong momentum for boosting enthusiasm in the market, the CPCA said.
The CPCA expects China's overall passenger car retail sales to be around 1.7 million units in March, rebounding 64.5% month-on-month, despite a 12.4% year-on-year decline.
This also indicates that the NEV penetration rate will recover to 52.9%, returning above the 50% mark after dropping to 44.9% in February.
In terms of weekly trends, the auto market had a weak start in early March due to the holiday hangover.
However, with the recovery of enthusiasm in the second week and the push from automakers to meet quarter-end targets, daily average retail sales are expected to surge to 93,000 units by the end of the month.
