China’s EV, hybrid exports jump 140% in March

China’s EV and hybrid exports jumped 140% year-on-year to a record 349,000 units in March, data from the China Passenger Car Association showed.

Higher fuel prices linked to the Iran conflict appear to have boosted overseas demand.

BYD accounted for about a third of those shipments, while Geely and Chery ranked next among exporters, and shipments from Tesla’s Shanghai factory were up about 9% from a year earlier.

At home, China’s EV and hybrid sales fell 14% to 848,000 units in March, marking a third straight monthly decline.

BYD’s domestic sales dropped more than 40%, while Tesla’s China sales fell 24%.

PCA Secretary General Cui Dongshu said weaker consumer spending and limits on trade-in subsidies hurt demand, especially for cheaper compact cars, whose deliveries fell 25%.

🔗 Source: Bloomberg

🧠 Food for thought

Implications, context, and why it matters.

China’s domestic EV market is slowing amid policy shifts and price wars

Domestic sales are falling as subsidy rules shift, alongside weaker spending and tighter trade-in support. China’s revised trade-in subsidy scheme now requires a minimum vehicle price of 166,700 yuan (US$24,000) to receive the maximum rebate 1.
The rule change squeezes mass-market brands like BYD. BYD’s average selling price was about 107,000 yuan (US$16,000), which helps explain the 25% drop in compact car deliveries cited by the China Passenger Car Association’s Cui Dongshu 1.
The subsidy hit lands during a bruising price war that has cut average auto sector profit margins from 8.7% in 2015 to 4.3% in 2023 2.
China is also winding down its decade-long full purchase tax exemption for EVs. A 5% purchase tax is scheduled to begin in 2026, which adds another drag on domestic sales 3.

Exports are becoming the release valve for overcapacity

Record exports give automakers somewhere to send excess output, with Chinese manufacturers producing an estimated 3 million extra EVs per year 4.
Overseas markets can pay far better. Rhodium Group, a research firm, estimates BYD makes around 14,300 euros (US$17,000) in profit on each Seal U sold in the EU versus about 1,300 euros (US$1,500) in China 2.
That profit gap helps firms live with new EU tariffs. The EU’s additional tariffs can reach 35.3%, pushing total tariffs as high as 45.3% once added to the bloc’s standard 10% car import duty 4. A 30% duty on BYD’s Seal U would still leave a roughly 15% (4,700 euros (US$5,500)) EU profit premium versus China, Rhodium Group estimates 2.
Tariff politics are also steering investment. Beijing has told automakers to pause heavy asset investment plans such as factories in countries that backed the EU’s tariffs, and to favor places that voted against them such as Hungary, according to people briefed on an Oct. 10 meeting held by China’s commerce ministry 4.