Half of Chinese auto dealer miss sales targets in '25, inventory pressures persist in '26 despite strong start forecast

Although the Chinese automobile market is expected to see a strong start in January 2026 driven by pre-Chinese New Year (CNY) demand and renewed old-for-new vehicle subsidies, automobile dealers continue to grapple with high inventory, shrinking profits, and fierce competition, signaling persistent operational pressures despite optimistic forecasts.

Data from the China Automobile Dealers Association (CADA) show that in December 2025, the inventory warning index for Chinese automobile dealers was 57.7%, up 7.5 percentage points year on year and 2.1 percentage points month on month. The inventory warning index is above the threshold line of 50, indicating a