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This year's Chinese auto market is quite divided, with one side freezing cold while the other is scorching hot.
CPCA data shows that from January to May this year, the national passenger car market cumulative retail sales totaled 7.099 million units, down 19.5% year-on-year, with the domestic market continuing to face pressure. Meanwhile, the export scene is quite different. From January to May this year, complete vehicle exports totaled 4.25 million units, with a year-on-year growth rate of 49%, export value reaching $73.6 billion, up 50% year-on-year, and export sales climbing steadily.
Clearly, the entire Chinese auto market now presents a "cold inside, hot outside" scenario, and auto export sales are unbelievably impressive. But selling more does not mean selling steadily; shipping cars away to sell is one thing, taking root locally is another. Great Wall Motor Chairman Wei Jianjun once scored the current state of Chinese auto exports out of 10 points, giving only 3 points, and this score still provokes deep thought today.
Chinese auto exports are far from the time to pop the champagne. Current achievements are more about the success of "Going Out" — shipping complete vehicles by ship and selling them abroad. But true globalization and long-term sustainability go far beyond this. It requires us to shift from "Going Out" to "Going In", taking root locally. This is the key to whether Chinese auto exports can truly bear fruit in foreign soil.
Over the past few years, the growth curve of Chinese auto exports has been quite steep. From 3.33 million units in 2022 to 8.32 million units in 2025, growth of about 2.5 times in four years. The trend continued in the first five months of this year, with single-month export sales hitting new highs. May complete vehicle exports reached 988,000 units, very close to one million units in a single month.
More worth noting is that from the sales volume of top independent brands, the overseas market is becoming the core engine pulling their sales growth. Under the pattern of cold domestic and hot overseas, surging exports not only made up for weak domestic demand but also reshaped the sales structure of major car companies. Export giants such as Chery, BYD, SAIC, Geely, and Great Wall have all stabilized the overall market by the rapid surge in overseas markets.
Chery's cumulative exports from January to May this year reached 753,000 units, up 69.5% year-on-year, creating a new record for Chinese autos of "over 700,000 units in five months". It is worth knowing that in 2025, Chery's overseas revenue was 157.4 billion yuan, surpassing the domestic market for the first time, accounting for 52.4% of total revenue. This means exports are no longer a supplementary item for them, but a key support for the profit structure.
There is also BYD, with exports of 617,000 units in the first five months of this year, ranking second. Over the past five years, its overseas sales grew from 50,000 units to 1.0496 million units, an increase of nearly 21 times. In May this year, BYD sold 383,453 vehicles, up slightly 0.3% year-on-year, of which overseas sales were as high as 160,177 units, up 80.7% year-on-year, with export share exceeding four-tenths.
Geely, SAIC, and Changan follow closely, and even Tesla, relying on Chinese manufacturing and East China port advantages, turned its Chinese factory into a gateway for global exports. However, behind the impressive export figures, the real challenges are just emerging. Growth rate does not represent everything; while export scale expands, resistance also accumulates simultaneously.
First is tariffs and trade barriers. EU anti-subsidy tariffs increased to a maximum of 45.3%, directly impacting pure electric vehicle exports to Europe. In January 2026, China and Europe reached a consensus on the "price commitment" mechanism, temporarily easing friction, but policy uncertainty was not eliminated. Meanwhile, Turkey proposed local production ratio requirements, Brazil raised import tariffs, and Indonesia set battery localization thresholds. Such requirements will only become more common.
Second is compliance costs. Currently, 144 countries have formulated data privacy related laws, and GDPR cumulative penalty amounts exceeded 7.1 billion euros. Smart cars involve massive data collection, transmission, and storage. Once entering strict regulatory markets, compliance costs cannot be underestimated.
Furthermore, there are brand and product adaptation issues. Chinese cars in overseas markets are currently selling products more than building brands. Cost-performance is the main advantage, but premium ability is limited. Brand awareness and user loyalty are still in the early accumulation stage. Product ideas familiar in the domestic market — stacking configurations, driving competition with parameters — may not hold true overseas.
Finally is cultural integration. This is different from product adaptation and involves management methods and daily operations. Differences in religious habits, work rhythms, communication logic, and holiday systems in different markets are far greater than imagined.
Regarding going overseas, there is a relatively clear stage classification in the industry.
Initially, it was the trade export stage, simply selling complete vehicles to achieve from 0 to 1. The second stage is brand export, gradually building marketing and service systems overseas, promoting own brands through a combination of general agents and independent dealers. The third stage is capacity and industry export, building KD factories locally, laying out supply chains, developing exclusive models for overseas markets based on regional R&D centers, and achieving localization of services simultaneously. The fourth stage is ecological export, where supporting services such as finance, insurance, and used cars follow in, and begin to participate in the formulation of technical standards in safety, intelligence, energy, etc. locally.
Currently, most Chinese car companies are in the second stage, with top few attempting to transition to the third stage. True "Going In" corresponds to the third stage and beyond. So how to go in?
First, adapt to local conditions. This is not just a slogan; Chery Tiggo 7 is a typical case. Although this car was born in China, it underwent deep R&D targeting usage scenarios, road conditions, regulations, and standards in over 100 countries worldwide. The highlands of South America in Brazil with altitudes of 300-1,500 meters on steep slopes, humidity up to 75% in Indonesia, desert highways averaging 46.9°C in the Middle East, and unlimited speed highways in Germany. Every extreme condition is within design considerations. It is not satisfied with "meeting Chinese standards for export", but rather "meeting global standards from birth". This thinking is exactly the leap from Going Out to Going In.
Secondly, localizing capacity and ecology is deeper rooting. BYD, SAIC, Chery and other top car companies are no longer satisfied with complete vehicle exports. Great Wall Motor's CKD export share reached 43.3%, SAIC-GM-Wuling 40.9%, SAIC Passenger Cars 10.5%. Knock-down exports and local assembly can both avoid tariff barriers and drive local employment, obtaining policy support.
Furthermore, building factories overseas. Chinese auto brands are accelerating "Going In" through overseas factory construction, where SAIC, BYD, and Chery strategies have different focuses.
BYD roots in multiple points globally. Its factory in Camaçari, Bahia, Brazil went into production in July 2025, with an annual capacity of 150,000 units; Szeged factory in Hungary is expected to start assembly in Q4 2026, also planning 150,000 units annual capacity; Thailand factory has gone into production, Indonesia factory plans to produce in 2026. In addition, factory building plans in Spain and Mexico are also being planned.
SAIC Group chose to build its first production base in the EU in the port of Ferrol, Galicia, Spain, with an initial investment of about 200 million euros, planning annual capacity of 120,000 units, planned to produce by the end of 2028. Chery prefers a "light asset" model. In Barcelona, Spain, it formed a joint venture with Ebro Group, utilizing the former Nissan factory. Meanwhile, Chery also signed a memorandum of cooperation for contract manufacturing with Nissan Sunderland Plant in the UK, planning to produce as early as the 2027 fiscal year.
As an automotive enterprise, to step out of the country is not just simple product output, but rooting locally, outputting technology and systems, obeying local regulations, understanding consumer needs, listening to their voices, striving to provide products most suitable for local consumers, thereby achieving the transition from "Going Out" to "Going In".
The stage achievements of Chinese auto exports are worthy of pride, but absolutely cannot be overly optimistic. Returning to Wei Jianjun's 3-point evaluation, he was not denying China's export achievements, but reminding everyone: selling cars is just the first step; true globalization is a long war. For Chinese auto exports to develop in the long run, they must have the ability to root and adapt, and truly "go in".
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