China's passenger-car market appears to be facing renewed pressure, with retail sales falling 23.2% from a year earlier to 1.6 million units in June, according to China's Passenger Car Association. New-energy vehicles, including plug-in hybrids and pure-electric vehicles, also declined 9% year-over-year, although the category still represented more than 60% of the market for a third consecutive month.
BYD Co. (BYDDF), a major Chinese maker of electric and plug-in hybrid vehicles, continued to benefit from stronger overseas demand, with total shipments rising 5.5% even as domestic sales fell by one-fifth. Exports of new-energy vehicles surged more than 150% to 499,000 units, suggesting foreign markets may be helping manufacturers absorb excess production as China's domestic auto market slows.
Tesla NASDAQ:TSLA, the Austin-based automaker, delivered 89,091 vehicles from its Shanghai factory in June, including 52,920 sold locally, marking its strongest monthly total of the year and extending its year-on-year growth streak in China to eight months. The latest data may increase investor focus on the widening divide across China's auto sector, as Zeekr moved past the halfway point of its annual sales target while Xpeng Inc., a Chinese electric-vehicle maker, remained well behind initial projections after weaker first-half deliveries, with the PCA warning that costs and margins remain under pressure from automotive-grade chip prices and speculative lithium carbonate bidding.