China's Auto Market Enters New Era of Stock Competition and Experience-Driven Growth

From April 11 to 12, 2026, a high-level forum on intelligent electric vehicle development was held under the theme of “Intelligentization, Green Transition, Integration, and Internationalization,” focusing on global automotive industry trends and cutting-edge technologies such as AI and chip computing power. Wang Qing, Deputy Director-General of the Institute of Market Economy at the Development Research Center of the State Council, analyzed at the forum that China’s auto sales saw a notable decline in the first quarter of 2024, driven by three overlapping factors: First, overall consumer demand naturally softened, with replacement and upgrade purchases accounting for a larger share—demand that is highly sensitive to macroeconomic conditions, employment, and income expectations. Second, 2023’s sales growth reached 9%, significantly exceeding the potential growth rate of 3%–4%, leading to a technical correction in 2024. Third, recent policy adjustments triggered short-term market contraction. Wang Qing emphasized that, in the long term, the fundamental logic driving China’s auto market growth has undergone a “fundamental shift.” With vehicle ownership at approximately 256 units per 1,000 people—within the 200–400 range characteristic of moderate-to-low growth—the annual potential growth rate is projected to be around 2% by the end of the “Fifteenth Five-Year Plan” period (2030). The market’s growth trajectory has shifted downward and flattened, signaling the end of the high-growth era fueled by demographic dividends and mass-market penetration. The industry has now entered a new phase dominated by stock optimization, with incremental growth playing a secondary role. Structurally, new energy vehicles (NEVs) remain the primary driver of domestic sales growth, with their substitution effect continuing to strengthen. Vehicle exports have already reached 7 million units, becoming a significant variable influencing total sales. Meanwhile, internal combustion engine (ICE) vehicles and NEVs are following divergent development paths. Additionally, car consumption is evolving from mere transportation toward an “emotional and lifestyle-oriented” proposition, shifting marketing logic from product-centric competition to “meaning-driven” competition. Looking ahead, four key trends will shape future auto consumption: First, demand is becoming increasingly personalized, community-based, and niche-oriented, with consumption scenarios blending across industries. Second, AI and advanced technologies will deeply enhance user experience, requiring automakers to develop products tailored to derivative use cases—such as camping, fishing, and road trips—and deploy omnichannel touchpoints including direct-to-consumer (DTC) models and KOL/KOC engagement. Third, values centered on simplicity, sustainability, and wellness are gaining traction, resulting in simultaneous declines in average transaction prices and upgrades in experiential quality, alongside rising acceptance of used vehicles. Fourth, cultural elements are emerging as a critical differentiator; companies must transform “hard selling points” into emotionally resonant “soft narratives” to drive instant purchasing decisions and foster community-based brand loyalty.