Autos Sector China auto sales (June): Domestic ICE demand collapses, even as prices fall; monthly exports top 1 million units

Research evidence excerpt

Autos Sector China auto sales (June): Domestic ICE demand collapses, even as prices fall; monthly exports top 1 million units

J P M O R G A N Asia Pacific Equity Research

09 July 2026

Autos Sector

China auto sales (June): Domestic ICE demand

collapses, even as prices fall; monthly exports top 1

million units

China’s passenger car sales continued to fall in June, down by over 20% YoY at the Japan Equity Research

retail level. Despite record discounting campaigns by internal combustion engine

Autos & Auto Parts

(ICE) automobile manufacturers, including luxury cars, some demand shifted into

used ICE autos with zero recorded mileage, and new ICE vehicle demand slumped, Akira Kishimoto AC

down 39% YoY. The new energy vehicle (NEV) penetration rate in domestic sales (81-3) 6736-8646

akira.x.kishimoto@jpmorgan.com

was unchanged MoM at 63%, but this will likely increase still further through the

Wencong Zhang

summer as ICE promotions wind down and seasonal factors play a role. (81-3) 6736-8627

Automobile exports grew 75% YoY, with the monthly total surpassing 1 million wencong.zhang@jpmorgan.com

units for the first time. Within these, passenger car exports hit a record high for the JPMorgan Securities Japan Co., Ltd.

fourth consecutive month. In our opinion, if gasoline prices remain high due to the

deadlock in the Middle East, many automobile and parts manufacturers that have

relied on ICE earnings will likely have to consider the continued existence of their

Chinese businesses.

• Pattern of falling domestic demand and rapid export growth unchanged:

China’s June passenger vehicle retail sales amounted to 1,618,000 units (-23%

YoY), and our impression is that demand cooled further than expected

considering mid-year sales campaigns and companies’ more aggressive

promotions.