Cui Dongshu: Domestic passenger vehicle demand is far from peaking; the short-term downturn is a temporary disturbance, and the long-term market still has huge growth potential.

According to the Zhitong Finance APP, Cui Dongshu, Secretary-General of the China Passenger Car Association (CPCA), wrote an article pointing out that the domestic passenger car market has recently remained sluggish. Since the second quarter of 2026, domestic passenger car retail sales have declined by about 20%, and pessimistic sentiment in the industry has continued to intensify. Some views hold that the domestic auto market has already reached its demand ceiling and that the era of total volume growth has completely ended. Through a comprehensive benchmarking of China's core consumption province, Guangdong, against the Japanese market, I conducted in-depth research and judgment across multiple dimensions, including population size, household income structure, car ownership penetration rate, new car sales cycles, urban-rural consumption differences, and institutional and policy systems, and systematically demonstrated that the current downturn in the auto market is a phased disturbance caused by the superposition of multiple short-term factors, rather than a peak in the fundamentals of automobile popularization. China's passenger car market is still in the mid-stage of popularization, the blue ocean of first-time purchase demand in lower-tier counties is broad, and combined with the cost revolution brought by the new energy vehicle industry chain, the medium- to long-term growth space is enormous. In particular, a comparison of the micro mobility vehicle systems between China and Japan clearly shows that China does not lack automobile consumption demand, but rather lacks a Japanese K-Car-style inclusive consumption incentive regulatory system. Constraints in the regulatory and tax and fee systems have suppressed the release of enormous entry-level first-time purchase demand. Auto industry participants should abandon short-term pessimism and firmly uphold confidence in the long-term growth of China's auto market.