China's Electric Vehicle Exports Hit Record, Domestic Market Cooling

China has reinforced its position as the global leader in electric vehicle (EV) production, with recent export figures reaching record highs. The worldwide energy crisis has spurred demand, enabling Chinese manufacturers to capture a significant share of foreign markets. Meanwhile, domestic sales have experienced a sharp decline. In March, EV sales fell by double‑digit percentages, marking the steepest contraction in six years. The cooling of the domestic market is seen as a reflection of shifting consumer preferences and economic uncertainty. The Chinese government’s tapering of incentive packages—particularly the reduction of tax breaks and subsidies—has made it harder for the domestic market to recover. This move has increased cost pressures on manufacturers, contributing to the sales slump. The imbalance between rising exports and a cooling domestic market may prompt Chinese automakers to reassess their strategic plans. While companies continue to pursue growth abroad, they are also exploring new incentive models to stimulate the domestic market. This is not investment advice.