Gasgoo Munich-In 2014, China's auto imports hit a historic peak of 1.43 million units. That year, imports were synonymous with "high-end"—a key choice for consumers seeking quality and brand prestige. Ten years on, that figure has shrunk to a fraction of its former self.
Data disclosed by Cui Dongshu, secretary-general of the China Passenger Car Association (CPCA), shows China imported 38,000 vehicles in June 2026, down 11% year-on-year. Cumulative imports for the first half totaled 200,000, also an 11% decline. Extending the timeline, full-year imports stood at just 700,000 in 2024, falling further to 480,000 in 2025.
Amid the sweeping rise of domestic vehicles, the import market is undergoing a reshaping—moving from simple volume contraction to a qualitative shift. From 1.43 million in 2014 to just 200,000 in the first half of 2026, the presence of imported cars in China's auto market has arguably hit a historic low. Why does the market keep shrinking? Why are imported new-energy vehicles suffering a total rout? Why is brand divergence so intense? These three questions outline the full picture of the end of the "golden era" for imported cars.
Shrinking by Nearly 70% in a Decade: Imported Cars Just Can't Move
The contraction didn't happen overnight. After peaking at 1.43 million units in 2014, the import market began a volatile downward trend.
Although there was a brief stabilization from 2016 to 2017, the downward trend since 2018 has been irreversible. The sustained decline in imported luxury car sales appears, on the surface, to be the result of a shrinking market size. But the deeper cause is a misalignment between the development paths of these brands in China and a shifting consumer environment. For a long time, the competitive edge of imported cars lay in brand recognition and technological barriers. Now, as domestic automakers catch up, those barriers are being broken down one by one.
Image Credit: AI Generated
From 2021 to 2025, annual import volumes were 930,000, 880,000, 800,000, 710,000, and 480,000 respectively—a nearly 50% reduction in scale over five years. Even smoothing out the fluctuations, this marks eight consecutive years of negative growth.
Entering 2026, the rate of decline has narrowed slightly compared to the previous two years. According to data from the General Administration of Customs compiled by the China Association of Automobile Manufacturers (CAAM), auto imports totaled 163,000 units from January to May 2026, a 10.6% year-on-year drop. Import value stood at $7.54 billion, down 19.2%. The decline in value is nearly double that of volume, indicating that average prices are falling alongside shrinking sales.
Looking at monthly trends, imports in the first half followed a "rise then fall" pattern. Early 2026 saw a short-term rebound, largely due to a low-base effect following an abnormal drop in December 2025. Cui Dongshu noted that "the start of 2026 still represents a rare relatively strong performance for the January-to-June period." However, entering March and April, the decline accelerated due to transport disruptions caused by conflict between the U.S. and Iran. In May, imports reached 38,000 units—up 40.4% month-on-month but down 18.6% year-on-year. June continued the downward trend with 38,000 units, an 11% annual drop.
The retail picture is even bleaker. Retail sales of imported cars totaled 190,000 units in the first half of 2026, a 29% year-on-year decline. June alone saw volumes drop to 30,000, a 39% plunge. Notably, this decline was recorded against the backdrop of a low-base effect in early 2025—Cui remarked that a "29% drop isn't too bad," yet he judged that "future pressure remains immense."
The shrinking market share of imports stems from a comprehensive substitution by domestic vehicles. In 2020, the split between joint-venture brands and domestic brands was roughly 60-40 (joint ventures at 61.6%, domestic at 38.4%). By the first half of 2026, that landscape had completely reversed. CAAM data shows domestic brand passenger car sales reached 9.14 million units in the first half, capturing a 71.8% market share, while joint ventures and foreign brands combined held just 28.2%. In five years, the domestic brand share surged from 38.4% to 71.8%—a gain of over 30 percentage points, mostly carved out of what was once territory for joint ventures and imports.
Meanwhile, the gap between exports and imports is widening dramatically. In the first half of 2026, China's auto exports soared to 5.10 million units, a 65.3% year-on-year jump, with June alone breaking the 1 million unit mark for the first time. The contrast is stark: export volumes are now several times higher than imports, signaling a fundamental shift in the global role of China's auto industry.
The Import Market: The Tables Turn
Against the backdrop of shrinking total volumes, the structural changes within the import market are even more noteworthy.
Image Credit: Cui Dongshu's WeChat Account
By country of origin, Japan has firmly secured its position as China's largest source of imports. From January to June 2026, imports from Japan reached 103,493 units, an increase of over 20,000 from the previous year. Germany followed with 44,311 units in second place, the U.S. with 17,732 in third, and Slovakia with 13,520 in fourth. June data further confirmed this hierarchy: Japan at 18,486 units, Germany at 9,272, Slovakia at 4,122, and the U.S. at 3,359. Compared to the previous year, Japan's monthly increase alone reached 5,131 units, far outpacing other nations.
The contrarian growth of Japanese imports is largely driven by the unique market positioning of Japanese brands. Unlike their German counterparts, the Japanese luxury brand Lexus still sells exclusively through imports in China. Amid the broader slide, its sales have remained relatively robust.
Image Credit: BMW China
German brands, meanwhile, have seen import demand diluted by the large-scale localization of their core models. Following the domestic launch of the Mercedes-Benz GLC, sales of the imported version plummeted. Similarly, for the BMW 5 Series, despite a domestic option being available, the imported version still recorded 489 sales in May 2026. This pattern of "cannibalization between domestic and imported versions" has placed German imports under greater pressure during the market downturn.
Industry data shows Lexus sold 184,000 units in 2025, a 2% year-on-year increase, maintaining steady growth after holding at the 180,000 level for three consecutive years from 2022 to 2024. In the first half of 2026, although terminal sales slipped, the decline was smaller than the overall market's 29% drop, demonstrating relative resilience among imported luxury brands. Additionally, Japanese product strategies support import volumes—certain high-end models favored by domestic consumers have not been localized, keeping import demand relatively inelastic.
Image Credit: Huaban
In terms of engine displacement, gasoline models under 2.0 liters accounted for 64% of imports, up 4 percentage points from last year. Meanwhile, sales of large-displacement imports (3.0 to 4.0 liters) declined relatively slowly, increasing their share. This structure—dominated by small displacement but resilient in large displacement—reflects a market polarizing at both ends: ordinary consumers lean toward smaller, more economical imports, while high-net-worth individuals maintain demand for large-displacement luxury vehicles.
Cui Dongshu attributes this to the domestic market's focus on vehicles under 2.0 liters, meaning imported models above 3.0 liters face relatively less competitive pressure.
Unlike the resilience of large-displacement cars, imported new-energy vehicles (NEVs) are on a downward trajectory—shifting from high growth to sustained decline. From 2021 to 2023, imported NEVs saw continuous high growth, but 2025 brought a sharp downturn. In the first half of 2026, imported battery electric vehicles (BEVs) fell 36%, while plug-in hybrids (PHEVs) dropped 58%. The share of NEVs in total imports has slipped from 3% in 2024 to just 2% in the first half of 2026. With BEVs seeing a massive decline, internal combustion engine vehicles remain the absolute mainstay.
The rout of imported NEVs stems from the systemic advantages of domestic rivals in technology, pricing, and product iteration. By the first half of 2026, the penetration rate of domestic NEVs had exceeded 80%, while mainstream joint-venture and foreign brands managed just 14.1%. The gap between these figures exposes the systemic lag of foreign automakers in the EV race—a deficit built up over years, not explained by short-term fluctuations.
As domestic electric vehicles iterate rapidly—adopting 800V high-voltage platforms, city NOA, and smart cockpits—imported NEVs consistently lag a step behind in product competitiveness. Cui Dongshu put it bluntly: domestic cars were highly competitive in 2025, driving a 67% drop in NEV imports from major source countries. In 2026, pressure on imported NEVs intensified further, with German imports performing poorly and U.S. imports seeing virtually no sales.
Who Holds Their Ground, and Who Exits?
The divergence in the import market is evident not just in structure and country of origin, but also in brand competition and regional distribution—a stark contrast of "ice and fire." Amid the overall downturn, luxury brands have seen clearly divergent trajectories. Lexus remains one of the few imported brands maintaining relative stability.
Industry data indicates Lexus imported 70,600 vehicles in the first half of 2026. Despite a 10% year-on-year decline, it retained the top spot among imported luxury brands. Mercedes-Benz followed with 35,900 units, down 4%, showing relative stability; BMW ranked third with 22,700 units, down 15%. Land Rover's sales of 13,700 units surpassed Porsche's 12,900, while Audi recorded just 8,000 units, a 43% plunge. Year-on-year sales for imported models from the German big three luxury brands all fell between 40% and 60%.
Cui Dongshu noted that despite the recent sustained slide in imports, Lexus sales have remained relatively steady, securing its position as the leading imported luxury brand.
Image Credit: Lexus China
At the model level, the Lexus ES saw insurance registrations exceed 44,000 units in the first half, leading all imported models by a commanding margin. The Mercedes-Benz GLE-Class ranked second, but its sales were less than a third of the ES. Three Lexus models cracked the top ten in first-half sales, firmly dominating the head of the pack. However, while the ES sits securely at the top, it still slipped 11.3% year-on-year—a reflection of the continuous diversion of market share toward domestic high-end NEVs and localized luxury models.
Ultra-luxury brands are experiencing even more violent fluctuations. Cui Dongshu stated bluntly that "some ultra-luxury brands are showing abnormal fluctuations and signs of a collapse, indicating significant operational pressure." From January to April, Bentley sold 489 units, down 30.3%; in May alone, imports hit 115 units, a 36% drop. Ferrari imported 36 units in May, down 32%, while Rolls-Royce imported 29 units, a 45% plunge.
Image Credit: Maserati
Maserati's situation is even more dire. In May, it imported only 21 units, an 80% freefall. In the first quarter of 2026, the Maserati Grecale saw price cuts of up to 40%. Once a market opener with its relatively approachable positioning, Maserati is now squeezed by the upward expansion of mainstream luxury brands while struggling to build a solid reputation in the top-tier ultra-luxury circle.
Porsche has not been spared either, falling from an annual sales volume of over 90,000 units in 2022 to just over 40,000 in 2025, with 2026 seeing further declines.
The overall weakening of the ultra-luxury market is linked both to a temporary slowdown in purchasing power among the ultra-wealthy and to the rise of domestic high-end brands. Bentley, for instance, saw little interest even after cutting prices by 500,000 yuan—a microcosm of this trend. Domestic high-end NEV brands like Kuangjie and Yangwang have launched products in the million-yuan price bracket offering extreme performance and intelligent features, steadily eroding the brand premium of traditional ultra-luxury internal combustion vehicles.
The import market has shifted from "incremental competition" to "stock game." Amid shrinking volumes, brands lacking in brand power, product strength, or channel reach are being cleared out. The ultra-luxury sector is currently undergoing exactly this clearance process.
Behind these structural shifts lie two forces at play. First is the rise of domestic vehicles, with cumulative market share reaching 71.8% in the first half of 2026. As domestic cars catch up to or even surpass imports in quality, technology, and intelligence, the consumer perception that "imported equals high-end" is being shattered.
Second is the shift in consumption structure. As new-energy vehicles become ubiquitous, demand for traditional imported internal combustion engines is being largely replaced by domestic NEVs. As Cui Dongshu has repeatedly emphasized, "with the rise of domestic cars and the acceleration of international brand localization, auto imports have remained sluggish in recent years."
From 1.43 million in 2014 to 200,000 in the first half of 2026, China's auto import market has spent over a decade completing a transition from a "golden era" to "structural contraction."
Conclusion:
Over the past decade, imported cars have completed an identity transformation from a "symbol of high-end" to a "niche choice." Japanese brands holding their ground, the retreat of ultra-luxury, and the shrinking of new-energy vehicles—these are not isolated phenomena but a chain reaction of market reconstruction.
Today, the role of imported cars in the Chinese market is being redefined. They are retreating to a more segmented track where scale is no longer the objective—satisfying personalized demand is the only reason to remain.
