32 Internal Combustion Engine Models Slash Prices to Clear Inventory

[Market Dynamics] From January to May 2026, 32 internal combustion engine (ICE) vehicle models reduced prices, intensifying the price war while sales continued to decline.

Core Trend: Across-the-board Price Cuts Fail to Halt Shrinking Market Share

32 conventional ICE models lowered their prices between January and May 2026, an increase of 13 models year-over-year; the average price reduction in May was RMB 25,000, representing a 14.9% drop. The BMW 7 Series saw the steepest cut at RMB 301,000, the Land Rover Range Rover Evoque L dropped by 49%, and the Nissan Sylphy Classic fell to as low as RMB 50,200.

Key Data: Plummeting Sales Amid Soaring Inventory

April ICE vehicle retail sales totaled only 530,000 units, a year-over-year plunge of 37%, with market penetration falling below 30%. Nationwide inventory reached 2.6 million units, yielding an inventory coefficient of 1.89 (the warning threshold is 1.5), including 1.07 million China VI-A compliant vehicles that must be sold by June 30.

Industry Impact: Widespread Dealer Losses and Store Closures

Over 80% of dealers are selling below cost. Nearly 5,500 4S stores have shut down since 2025, driving the industry’s profit margin down to a record low of 2.9%.