May NEV Retail Sales Expected to Hit 950,000 Units, Penetration Rate Soars to Record High of 62.5%

Domestic new energy vehicle (NEV) retail sales in May are expected to reach 950,000 units, up 12% month-over-month, with a market penetration rate of 62.5%—a record high. In April, retail sales of passenger vehicles (narrow definition) totaled 1.382 million units, declining both year-over-year and month-over-month. Conventional fuel-powered vehicle sales dropped significantly, while NEV retail sales reached 848,000 units, accounting for 61.3% of the market. The auto market showed clear signs of recovery in May, driven by the May Day holiday, regional auto shows, and manufacturer promotions. Following the Beijing Auto Show, deliveries of multiple new models commenced, bolstering NEV market performance. Leading automakers raised their May retail targets by approximately 10% compared to April, aligning with typical seasonal trends. Overall passenger vehicle (narrow definition) retail sales in May are projected to reach around 1.52 million units, an increase of nearly 10% from April. Although auto consumption remains in a phase of moderate recovery, consumers remain cautious about large expenditures, and the stimulus effect of trade-in policies has weakened compared to last year. Dealer inventory pressure was notably high in April, but as the front-loaded impact of earlier policies fades, the market is gradually returning to a normal rhythm. Post-holiday foot traffic and orders for fuel-powered vehicles have declined markedly, further widening the gap with NEVs. Supported by increased new model availability, accelerated deliveries, and stable demand, NEVs continue to drive higher market penetration rates.