CPCA sees China August NEV retail sales at about 1.04 million, penetration may hit record

• China’s passenger NEV retail sales are expected to rise about 9.4% from July, with retail penetration reaching 65.8%.
• Overall passenger vehicle retail sales are expected to fall 21.7% year-on-year, while NEVs continue to gain share in a weak auto market.

China’s new energy vehicle (NEV) retail sales are expected to rebound in August from July, as the opening of the Chengdu Auto Show helps drive orders for new models and the market begins recovering from a seasonal low.

The China Passenger Car Association (CPCA) said on Friday that passenger NEV retail sales are expected to reach about 1.04 million units in August, up about 9.4% from 951,000 units in July.

NEV retail penetration is expected to reach 65.8%, up from 65.1% in July. If the forecast is realized, China’s monthly NEV retail penetration rate would set another record.

The broader auto market is still performing significantly worse than the NEV segment. The CPCA expects passenger vehicle retail sales to reach about 1.58 million units in August, up 8.1% from July but still down 21.7% year-on-year.

That means NEVs continue to provide the main support for China’s passenger vehicle market even as consumer demand for big-ticket items such as cars remains weak.

The market was subdued in early August as summer factory shutdowns at some automakers and typhoons along China’s southeastern coast weighed on showroom traffic and transactions. Average daily retail sales were about 35,000 units in the first week.

Transactions began to recover in the second week as weather disruptions eased and previously suppressed demand was released. The CPCA said a wave of new-model announcements in the third week also helped drive continued sequential improvement in orders.

The 2026 Chengdu Auto Show opened on Friday, with multiple automakers launching or opening pre-sales for new models around the event.

The CPCA expects the auto show effect, combined with automakers’ month-end sales push, to lift average daily retail sales to about 77,000 units in the fourth week.

Still, the CPCA said the real peak season for auto consumption has yet to arrive, as consumer expectations and underlying fundamentals have not improved materially.

China’s total retail sales of consumer goods rose 2.6% year-on-year in the first 7 months of the year, while retail sales of automotive goods fell 13.2%, showing that autos remain a major drag on big-ticket consumption.

Pressure on gasoline-powered vehicles has been particularly pronounced. Retail sales of gasoline-powered passenger vehicles in China totaled 510,000 units in July, down 40.5% year-on-year, compared with a decline of just 3.9% for NEVs.

Passenger NEV retail sales totaled 951,000 units in July, down 3.9% year-on-year and 5.8% from June, marking the seventh consecutive month of year-on-year declines. Still, their retail penetration rate rose to a record 65.1%.

The CPCA expects high fuel prices and aging products to continue weighing on demand for gasoline-powered vehicles, while new-model launches, retail promotions and vehicle trade-in policies provide further support for the NEV market.

NEV retail sales totaled 399,000 units from August 1-16, with retail penetration at 63.6%.