ICE Vehicle Sales Keep Slumping as NEV Penetration Surpasses 60%

In April 2026, domestic retail sales of fuel-powered vehicles dropped by 37% year-on-year, with cumulative sales from January to April declining by 10% year-on-year. During the same period, retail sales of new energy passenger vehicles surged by 60.6% year-on-year, pushing their market penetration rate above 60% for the first time. In Hangzhou’s used-car market, sales of fuel-powered vehicles have slumped; some new models originally priced at over RMB 400,000 are now listed at RMB 260,000–270,000 but still struggle to find buyers. New fuel-powered vehicles are seeing average price cuts of 17.2%, while three-year resale values for used fuel cars have generally fallen below 50%. Some models are losing RMB 20,000–30,000 in value per month, resulting in inverted pricing—where used-car prices fall below those of new ones. Joint-venture brands such as BMW, Benz, Audi (BBA), Volkswagen, Honda, and Nissan have all launched aggressive discount promotions, yet market response remains muted. Car dealers across multiple regions report severe losses from selling fuel-powered vehicles and mounting inventory pressures.