According to a report by Nikkei Asia, Chinese automotive companies are moving steadily toward the number-one position in global car sales, ending Japan’s two decade long lead in the industry.
The projection is based on annual sales figures released by automakers and data from S&P Global Mobility covering January to November 2025, including domestic sales, exports, and commercial vehicles.
The report estimates that Chinese carmakers’ global sales will rise by around 17 percent year-on-year, pushing total sales close to 27 million vehicles. China already became the world’s largest car exporter in 2023 and is now closing in on overall market leadership.
A key driver of this growth is China’s massive domestic market, which accounts for nearly 70 percent of total sales.
Strong government support and consumer demand for electric vehicles (EVs) and plug-in hybrids have reshaped buying habits. New-energy vehicles now make up almost 60 percent of passenger car sales in China, marking a major shift in the industry.
In contrast, Japanese automakers’ global sales are expected to remain flat at around 25 million vehicles. Japan once reached a peak of nearly 30 million vehicle sales in 2018, but its lead over China about 8 million vehicles in 2022 has nearly disappeared within just three years.
At the same time, Chinese manufacturers are facing intense competition at home, marked by overcapacity and aggressive price wars.
Major EV makers, including BYD, have cut prices to stay competitive. The strongest sales have been recorded in the 100,000 to 150,000 yuan price range, accounting for nearly a quarter of all new energy passenger vehicle sales.
As competition tightens domestically, Chinese carmakers are increasingly looking outward, relying more on exports and competitive pricing to absorb surplus production. Extra electric vehicles are being pushed into overseas markets at a rapid pace.
This strategy is reshaping regional markets. In Southeast Asia (ASEAN) long dominated by Japanese brands Chinese car sales are expected to jump 49 percent this year to around 500,000 units.
Thailand stands out as a clear example of this shift, where Japanese brands’ market share has fallen to 69 percent, down from nearly 90 percent five years ago.
Chinese vehicles are also gaining ground in Europe, where sales are projected to rise 7 percent to about 2.3 million units, despite the European Union imposing additional import duties on China made EVs.
In response, Chinese manufacturers have increased exports of plug in hybrid vehicles, which are not covered by those tariffs.
Growth is equally strong in emerging markets, with sales in Africa expected to rise 32 percent to 230,000 units, and in Latin America by 33 percent to around 540,000 units.
Taken together, these trends show how China’s auto industry is shifting gears globally, combining scale, pricing power, and new energy technology to challenge long standing leaders and redraw the map of the global car market.
