The Ministry of Industry and Information Technology (MIIT), together with eight other government departments, has released the Work Plan for Stable Growth of the Automotive Industry (2025–2026). The plan sets targets and introduces a broad set of policy measures aimed at consolidating the automotive industry’s role as a pillar of China’s economy, while addressing emerging pressures from global competition and domestic structural challenges.
Background
China’s automotive sector has achieved three consecutive years of growth, with new energy vehicles (NEVs) driving much of the momentum. In 2024, automobile sales reached 31.4 million units, up 4.5% year-on-year. Of this total, 12.9 million were NEVs, marking a 35.5% increase and strengthening the sector’s contribution to the wider economy.
Despite these achievements, MIIT acknowledges that the industry faces significant headwinds. These include rising international competition, insufficient domestic demand, and problems of disorderly competition within the market. Against this backdrop, the Work Plan has been introduced as a policy framework to stabilize growth, guide structural transformation, and sustain competitiveness.
Policy Orientation
The plan emphasizes a dual focus on the supply and demand sides of the industry, reflecting the broader national strategy of “seeking progress while maintaining stability.” Its objectives are not only to stabilize short-term sales growth but also to lay the foundation for long-term quality improvement and industrial upgrading.
The approach is summarized by three guiding principles: accuracy, practicality, and innovation.
Accurate: Setting Realistic Targets
The plan sets measurable targets for the next two years.
- In 2025, automobile sales are projected at around 32.3 million units, up 3% year-on-year, with NEVs expected to reach 15.5 million units, a 20% increase.
- By 2026, the focus shifts to maintaining stable growth while improving scale, efficiency, and quality across the industry.
These targets reflect both optimism in NEV expansion and caution regarding overall market conditions.
Practical: Implementing Detailed Measures
The Work Plan introduces 15 work measures and three safeguard measures, spread across four policy dimensions: expanding domestic consumption, improving supply quality, optimizing the business environment, and deepening international cooperation. In total, more than 60 detailed initiatives are outlined.
Examples include:
- NEV development: Policies to promote electrification in the public sector, expand rural adoption of NEVs, strengthen county-level charging infrastructure, and advance battery swap models.
- Export support: Enhanced financial services for auto exporters, including greater credit availability, global fund management tools, and optimized export credit insurance.
These practical measures are intended to support both domestic sales and international market expansion.
Innovative: Driving Demand through High-Quality Supply
Beyond stabilizing demand, the plan highlights innovation as a lever for sustainable growth. It proposes measures to stimulate consumer demand through technological advancement, raise product quality via higher standards, and accelerate digital and intelligent transformation of the automotive sector.
Reforms to vehicle access management and group management of manufacturers are also planned, alongside initiatives to standardize competition, improve resource allocation, and create a healthier industrial ecosystem.
Implications for the Industry
For domestic automakers, the plan provides clarity on government priorities and policy direction. Companies operating in the NEV segment stand to benefit from continued support for electrification, charging infrastructure, and related incentives. Export-oriented firms will gain from enhanced financial backing and risk management tools.
At the same time, the plan underscores that market competition will be more closely regulated, with reforms aimed at curbing disorderly practices and raising the bar for product quality.
For foreign automakers, the outlook suggests both opportunities and challenges. On one hand, the sustained policy push behind NEVs and intelligent vehicles may open avenues for technology cooperation and market participation. On the other, the emphasis on domestic innovation and supply-chain resilience points to a more competitive operating environment.
Conclusion
The Work Plan for Stable Growth of the Automotive Industry (2025–2026) reflects China’s intent to safeguard its automotive sector as a strategic pillar of the economy while addressing structural vulnerabilities. By combining near-term sales targets with long-term reforms, the government aims to foster a more innovative, efficient, and internationally competitive industry.
The plan’s success will depend not only on policy implementation but also on the ability of enterprises, both domestic and foreign, to adapt to shifting market dynamics, invest in innovation, and align with the evolving regulatory framework.