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02
2026
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03
2026 Automotive Industry Policy Adjustment: Resumption of 5% Purchase Tax on New Energy Vehicles
Industry Policy and Environment
A key adjustment to automotive consumption policies is set for 2026. While the national trade-in subsidy program will be optimized and extended, the new energy vehicle (NEV) purchase tax exemption will be partially phased out starting January 1, 2026. It is expected that a 5% purchase tax (with an upper limit on exemptions) will be reinstated. This change could impact vehicle purchase costs, and how the market absorbs this shift is a key point to watch.
Operational Performance
According to the latest data, the automotive market in January 2026 showed a combination of subdued domestic demand and robust exports. Domestic retail sales of passenger cars declined year-on-year, while the export market reached a record high for the same period, with NEV exports surging by over 100% year-on-year. Concurrently, the market structure is shifting towards the mid-to-high end, with a significant increase in the sales share of B-class and above vehicles.
Business Development
Several automakers have initiated new product cycles. Xiaomi Auto's next-generation SU7 has entered the mass-production confirmation stage, with a launch expected in April. Li Auto is previewing its new L9 model, and Voyah plans to introduce four new models within the year. The market acceptance of these new models will influence the performance of the respective companies.
Capital Flows
The auto parts sector has recently attracted capital attention due to cross-border concepts, particularly companies linked to areas like humanoid robots and AI data centers. The progress of such technological integration and its substantive contribution to the listed companies' businesses warrant attention.
Industry Chain Status
Fluctuations in upstream raw material prices pose a challenge to the industry. Prices for metals like lithium carbonate and copper have risen significantly since the second half of 2025, alongside a sharp increase in the price of automotive memory chips. This creates cost pressures for automakers. The stability of the supply chain and the effect of cost pass-through require continuous monitoring.
Institutional Outlook
Some institutions analyze that despite short-term market impacts from policy adjustments and other factors, sales are expected to stabilize and rebound after the Chinese New Year, following the implementation of detailed policy rules and new product launches. Intelligence and globalization are seen as the dual core drivers for the industry's long-term development.
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