On January 31, the China Automobile Dealers Association unveiled the results of its most recent "China Auto Dealer Inventory Alert Index Survey." The survey revealed that the inventory alert index for Chinese auto dealers in January 2026 was 59.4%. This marks a 2.9 percentage point decrease compared to the same period last year, yet it represents a 1.7 percentage point increase from the previous month, keeping the index above the critical threshold line.

The automotive market in January experienced sluggish momentum, influenced by a confluence of factors. These included the phasing out of purchase tax incentives for new energy vehicles, a depletion in demand, and the later timing of the Spring Festival. The trade-in subsidy policy failed to deliver a significant boost in the short term, fostering a pervasive wait-and-see attitude among end consumers. As a result, a substantial 68.8% of dealers reported a year-on-year decrease in both customer footfall and order volumes. The China Automobile Dealers Association has projected that the auto market will encounter substantial downward pressure in February.