China Auto Sales Drop in February as Demand Weakens

China’s auto market, the largest in the world, recorded a notable decline in February as weakening consumer demand and seasonal factors weighed on sales. Data from the China Association of Automobile Manufacturers showed passenger car sales dropped to about 950,000 units during the month, compared with nearly 1.4 million vehicles sold in January.

On a year‑over‑year basis, the downturn was also significant. Total passenger vehicle sales, including exports, fell roughly 15.4% compared with the same period a year earlier. However, Chinese automakers continued to see strong momentum abroad, with vehicle exports rising 58% to around 586,000 units as companies expanded into overseas markets.

Several factors contributed to the slowdown. The Lunar New Year holiday — China’s biggest annual holiday — lasted nine days this year, reducing the number of effective selling days in February. In addition, some local governments have begun phasing out trade‑in subsidies that previously supported purchases of new vehicles, particularly electric cars.

A broader economic slowdown and the prolonged slump in China’s property sector have also dampened consumer confidence, leading households to delay large purchases such as cars. Analysts expect domestic demand to remain under pressure in 2026, prompting Chinese automakers to rely increasingly on export markets to sustain growth.