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Amid increasing competition in the global automotive industry, automakers will need to sell at least three million vehicles annually to merely stay afloat by 2030, according to the chairman of a major Chinese state-owned car manufacturer.
Companies with yearly sales ranging from three to five million units are considered just surviving, he stated before the Beijing International Auto Show, which opened on April 24. Those selling between five and eight million units will be able to sustain themselves, while manufacturers surpassing eight million units will emerge as industry leaders.
This assessment is based on observations of the international market, where the top 15 to 20 automakers control roughly 70 to 80 percent of the industry, reinforcing the ongoing Matthew effect.
“The top 10 automakers worldwide need to sell at least 3.5 to 4 million vehicles annually,” remarked the founder of a leading electric vehicle startup in China. “Global expansion must be a priority for auto companies.”
There are currently 17 passenger car manufacturers in China, but that number is expected to decrease. Survival hinges on avoiding losses and achieving economies of scale, which are essential for future growth, he added.
A common challenge for Chinese passenger car brands is increasing revenue without boosting profits. Last year, profit margins in China’s auto sector dropped to a record low of 4.1 percent from 4.3 percent in 2024, and fell further to 2.9 percent in the first two months of this year, according to official statistics.
Data from 12 major publicly traded automakers show that none earned more than 10,000 yuan (approximately $1,465) profit per vehicle last year. For example, a leading automaker in China reported just 960 yuan ($140) profit per vehicle despite achieving record sales and revenue, with significant investments in new energy brands impacting overall profitability.
“The market pressure is quite intense,” said the CEO of a prominent Chinese automaker. He pointed out that product homogenization and the short lifespan of new models are squeezing profit margins.
Rising costs of raw materials have further intensified profit pressures. The chairman of an electric vehicle brand explained that prices for components such as onboard memory and raw materials like plastics have increased multiple times, which could significantly affect this year’s financial results.
Expanding abroad is becoming increasingly crucial for survival. One Chinese automaker announced a plan to invest approximately $14.6 billion over the next five years in overseas markets, aiming to build a globally coordinated supply chain and reach an annual overseas production capacity of 800,000 units by 2030. The company also plans to bolster its domestic market while simultaneously expanding internationally.
Another firm set a goal to sell 480,000 vehicles this year, with 340,000 in China and 140,000 exports, expecting substantial growth in global sales.
However, entering international markets presents many obstacles. Foreign competitors often view Chinese automakers as rivals trying to “capture” their markets. Therefore, successful globalization involves integrating into local environments, according to industry insiders.
Some companies focus on providing high-quality products abroad and establishing joint ventures with local partners to leverage regional resources and support local auto industry development. This strategy also aims to contribute to regional economic growth.
One leading Chinese automaker aims to make significant breakthroughs in electrification, smarter technology, and global market integration. The goal is for the company to become part of the local industrial ecosystem wherever it operates, fostering economic and social development.
Ranked as the top Chinese exporter of passenger vehicles for over two decades, a major automaker shipped nearly 150,000 vehicles overseas last month alone—a 72 percent increase from the previous year—setting a new monthly export record for China’s auto exports.
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