Western automakers lose China share

Financial Times reporting in April said Western carmakers were turning to Chinese technology partners to stay relevant in the world’s largest auto market, after years of lost sales and market share. Company disclosures since then have filled in the scale of the pressure: Volkswagen Group said its China deliveries fell 15% in the first quarter, BMW said its China sales fell 10%, Audi said its deliveries in China fell 12%, and Mercedes-Benz said its China sales dropped 27%. China’s own market data points in the same direction. The China Association of Automobile Manufacturers said Chinese-brand passenger vehicles captured a record 75% of the domestic market in April, while Reuters reported China’s domestic car sales fell for a seventh straight month that month. ### Which Western carmakers have reported the clearest declines? (ft.com) Volkswagen Group said on April 13 that deliveries in China fell 15% in the first quarter, ahead of launches of new locally developed electric models. The company said battery-electric deliveries in China dropped 64% after government subsidy programs expired. (english.scio.gov.cn) BMW said on April 14 that weak demand in China and the United States dragged on first-quarter deliveries, with China sales down 10%. Audi, Volkswagen’s premium brand, said the same day that deliveries in China, its largest market, fell 12% to 127,109 vehicles. Mercedes-Benz said on April 9 that its China sales fell 27% in the first quarter during what it called a transition year for its China business. (volkswagen-group.com) Porsche said on April 10 that global deliveries fell 15% in the quarter, with sharp declines in China and the United States. General Motors’ investor site shows it published a China sales release with first-quarter results on April 28. (money.usnews.com) A GM-focused industry report citing the company said China deliveries fell 22% year over year in the quarter as it shifted toward higher-value segments. ### Why is China getting harder for foreign brands? April data from China’s auto industry showed the market is shifting further toward domestic brands and new-energy vehicles. (money.usnews.com) CAAM said Chinese-brand passenger vehicles took a record 75% market share in April, and new-energy vehicles accounted for 53.2% of new car sales that month. CNBC reported on April 24 that foreign automakers had seen sales slump by as much as two-thirds in China since the pandemic, as local rivals moved faster on software, in-car technology and model launches. (investor.gm.com) The report said U.S., Korean and German brands were introducing China-specific models and using Chinese technology in a bid to win back buyers. (english.scio.gov.cn) Financial Times reported in April that Western executives were pursuing an “in China for China” strategy and increasingly partnering with Chinese technology groups. That shift followed years in which local brands such as BYD and Geely gained share in electric and plug-in hybrid vehicles, the fastest-growing parts of the market. ### Is this only a foreign-brand problem, or is China’s market weak overall? (cnbc.com) Reuters reported on May 11 that China’s domestic car sales fell 21.6% from a year earlier in April to about 1.4 million vehicles, marking a seventh consecutive monthly decline. The same report said exports stayed strong as automakers targeted overseas markets. (ft.com) Bitauto, citing final CPCA data released May 11, said passenger-car retail sales in April fell 21.5% year over year to 1.384 million units. That means Western brands are losing share inside a market that is also shrinking overall, increasing pressure on pricing and dealer inventories. ### What does the USMCA warning have to do with this story? Autos Drive America, which represents international automakers in the United States, says continuity in the U.S.-Mexico-Canada Agreement is critical for business certainty, investment flows and competitive advantages in North America. (msn.com) Its policy materials say the pact has become a stable framework for regional auto production and supply chains. (bitauto.hk) The agreement enters a mandatory joint review on July 1, 2026, according to multiple policy and legal analyses. That timetable matters because many of the same global carmakers facing pressure in China also rely on North American plants, parts flows and tariff rules to manage production and pricing. (autosdriveamerica.org) ### What should readers watch next? June will bring the next monthly China sales updates from the China Passenger Car Association and the China Association of Automobile Manufacturers. Those releases will show whether April’s record 75% domestic-brand share and the seventh straight monthly drop in China auto sales were extended into May. July 1, 2026 is the next fixed policy date for the industry, when the USMCA joint review is due to begin. (hub.americanindustriesgroup.com) Volkswagen, Mercedes-Benz, BMW and General Motors are also expected to provide second-quarter sales or earnings updates in July that will give the next company-by-company read on China demand. (english.scio.gov.cn)