China wholesales January 2023: Market sinks -35% on Covid surge, end of incentives and calendar quirk

BYD sales are up 40% in a market down -35%.

A combination of events have led to a struggling Chinese new car market in January. On December 7, the government ended its zero Covid policy and allowed travel and work without restrictions. This was followed by the worst Covid-19 outbreak the country has seen, meaning a lot of factory workers were out sick. On December 31, two sets of subsidies/incentives were eliminated: the new energy subsidies to manufacturers that were in place for 13 years, and the six-month old reduced tax on smaller vehicles. Finally, the Chinese New Year holiday started earlier this year, on January 21 through to January 27 vs. a start on January 31 in 2022, resulting in fewer working days this month.

All of this means the wholesales market is down a damning -35% year-on-year to just 1,649,000 units. Passenger Vehicles skid -32.9% to 1,469,000 while Commercial Vehicles implode -47.7% to 180,000 sales. Production is down -34.3% to 1,594,000 including 1,397 Passenger Vehicles (-32.9%) and 197,000 Commercial Vehicles (-43.1%). New Energy Vehicles still do well, edging down a moderate -6.3% to 408,000 and 24.7% share including 121,000 PHEV, up 42.5% year-on-year. Chinese brands hold 51.6% of the Passenger Vehicle market vs. 46% a year ago thanks to 758,000 sales. One bright spot is the export figure up 30.1% year-on-year to 301,000 units including 250.000 Passenger Cars, up 35.6%. NEV account for 27.6% of the exports at 83,000 units.

LI is up 23.4%

Volkswagen (-35.1%) keeps the lead of the brands ranking but follows the market with a harsh drop. The Lamando (+17.1%) is the brand’s only model in positive with the Santana (-1.8%), Tharu (-6.7%), Tayron (-13.6%) and Sagitar (-22.3%) containing their fall. At #2, BYD (+40.1%) continues to post gravity-defying scores and ends the month less than 15,000 units below Volkswagen. All its nameplates bar two are in positive, with the Yuan Plus (+617.1%), Dolphin (+65.8%), Song Plus (+58.5%) among the most impressive. The new Corvette 07 is up to over 5,000 sales for its first full month in market. Toyota (-30.6%) closes out the podium with just under 105,000 sales and falls slightly slower than the market with the Corolla Cross (+823.3%), Front Lander (+469.8%) celebrating one year in market, and the Vios FS (+50.6%), Sienna (+22.6%) and Vios (+13.2%) in positive.

Denza breaks its monthly volume record thanks to the D9 MPV

Changan (-30%) is up one spot on December and its Full Year 2022 ranking to #4 ahead of Geely (-39.7%), both manufacturers leapfrogging past Honda (-58.5%) in complete freefall. BMW (-28.2%), Mercedes (-24%) and Wuling (-20.2%) gain share year-on-year while Nissan (-63.8%) rounds out the Top 10 in paltry fashion. The next seven carmakers all lose more ground than the market average, with Hyundai (-16.9%) the only remaining Top 20 brand limiting its fall to below the average rate. But are there any other brands in positive alongside BYD? Yup. LI (+23.4%), Jetour (+6.9%), Denza (+3578.9%) breaks its volume at just under 6,500 units thanks to the 9 MPV, newcomer Shenlan is up 7 spots on last month to a record #34, Beijing (+1.7%), AITO (+448.3%) a little over one year old, Kaiyi (+115.4%), SWM (+56.3%) and Land Rover (+21.6%) in the Top 60. Note Land Rover is the only foreign brand in the lot. AvatR is up to #60 for its first full month of sales.

Looking at the models ranking, the BYD Song Plus (+58.5%) manages a 4th consecutive win with over 35,000 sales. It distances the VW Lavida (-40.9%) and Nissan Sylphy (-61.6%) both hit hard. The Changan CS75 Plus (-35.6%) is up three ranks on last month to #4, its best ranking since topping the charts outright back in February 2021. The VW Sagitar (-22.3%) remains at a solid 5th place vs. #14 over the Full Year 2022. It is followed by the BYD Dolphin (+65.8%) continuing its ascent, the Haval H6 (-53.2%) and Wuling Hongguang MINI EV (-55.7%) down to an unusually low #8. Outstanding result for the BMW 5 Series L (-33.8%) up to #9 from #58 in December while its main competitor the Mercedes E-Class L (-7.6%) goes from #55 to #11. The BYD Yuan Plus marks one year in market at #13.

Previous post: China wholesales 2022: BYD challenges Volkswagen, places Song Plus at #1 in market up 2.1%

One year ago: China wholesales January 2022: VW back in positive, Changan, BMW and Hongqi break records in stable market (+0.9%)

Full January 2023 Top 93 all brands and Top 493 all models below.