HONG KONG: China's passenger car exports surged in April as automakers accelerated their expansion overseas to offset weakening demand in the domestic market.

Exports of passenger vehicles rose nearly 85 percent from a year earlier to about 796,000 units, according to data released on May 11 by the China Association of Automobile Manufacturers. That was up from 748,000 vehicles exported in March.

Shipments of new energy passenger vehicles, including battery electric and plug-in hybrid models, jumped more than 120 percent from a year earlier to around 420,000 units.

At the same time, sales of passenger cars within China fell 25.5 percent from a year earlier to 1.3 million vehicles, marking the sixth consecutive month of annual declines.

Analysts said domestic demand has been hurt by reduced government incentives for consumers to trade in older vehicles for new energy models, as well as lingering economic uncertainty linked to China's prolonged property sector downturn.

Competition among automakers has also intensified.

At the Beijing auto show last month, more than 1,450 vehicles were displayed as manufacturers showcased technologies ranging from artificial intelligence-powered features to ultrafast-charging batteries.

Some analysts expect the domestic market to improve later this year as new models are introduced and consumers adjust to changes in subsidy programs.

More Chinese buyers are also likely to return to the market as confidence gradually recovers, said Yichao Zhang.

Overseas, Chinese brands such as BYD and Geely Auto continue to gain market share.

In addition to increasing exports, some automakers are expanding production abroad by building factories in Europe and Latin America.

Rising fuel prices linked to the war in Iran are also expected to encourage more consumers worldwide to switch to electric vehicles.

One in six new vehicles sold in Australia in April was an electric vehicle, according to the Federal Chamber of Automotive Industries, and BYD ranked as the country's second best-selling automotive brand behind Toyota Motor Corporation.

"With oil and fuel prices likely to stay elevated for a longer period, it would likely incentivize consumers to buy EVs, and this will benefit Chinese EV exports," said Claire Yuan.

Consultancy AlixPartners expects China's passenger car exports to rise about 20 percent in 2026 as manufacturers strengthen their presence in key overseas markets, particularly in Southeast Asia.

Chinese automakers remain largely shut out of the U.S. market after 100 percent tariffs were imposed in 2024. Industry executives are also watching trade talks between U.S. President Donald Trump and Chinese President Xi Jinping during Trump's visit to Beijing this week.