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By Kate Yuan

(JW Insights) Jun 27 -- The retail sales of passenger cars are expected to reach 1.83 million units in June, up 5.2% month-on-month and down 5.9% year-on-year. The retail sales of new energy vehicles (NEVs) may hit 670,000 units, increasing by 26% over the previous year, according to China Passenger Car Association (CPCA) on June 25.

Although the market demand fell slightly in early June, the situation may change in mid-June with the come of China’s June 18 (618) shopping festival, regional subsidies, and the Dragon Boat Festival.

China’s Ministry of Industry and Information Technology (MIIT) launched campaigns on June 15 to support NEVs going to the rural areas jointly with the other four ministries. Several popular models joined including BYD Seal, BYD Tang DM-i, Xpeng P5, Volkswagen ID3/ID4, and Changan Shenlan SL03.

On June 21, the Ministry of Finance, the State Taxation Administration, and MIIT jointly issued a notice to continue to exempt purchase tax for NEVs purchased between January 1, 2024 and December 31, 2025.

“This policy has stabilized market expectations and provided strong support for NEV market in the medium and long run,” said CPCA.