On March 23, Cui Dongshu, Secretary-General of the China Passenger Car Association, shared insights in an article. He revealed that across the nation, the wholesale volume of passenger cars saw a 9% uptick in 2025. Notably, new energy passenger cars surged by 25%, successfully hitting the growth targets set for the new energy vehicle market during the '14th Five-Year Plan' period. With the tax exemption policy for new energy vehicle purchases set to expire at the end of the year, the automotive landscape in 2026 is poised for a shift. Analysts predict a downturn in new energy vehicle sales and a surge in fuel-powered vehicle purchases ahead of the Spring Festival, as consumers rush to take advantage of existing incentives. However, the rollout of trade-in policies in most provinces and cities has been sluggish, and demand among mid-to-low-end consumers remains lackluster, resulting in significant market segmentation. In February 2026, retail sales of passenger cars took a 25% hit, a steeper decline than the 14% drop in wholesale volumes. The suspension of trade-in subsidies cast a shadow over retail sales in January-February, with A00-class sedans and budget MPVs seeing particularly low retail figures in February. In contrast, A0-class sedans and premium SUVs emerged as the powerhouses of retail sales, with the mid-to-high-end SUV segment posting impressive results.