Empty Showrooms in Beijing Show Why Chinese Carmakers Are Looking Abroad

Anyone trying to understand why China is so eager to ship cars overseas can start at a dealership in Beijing. Autumn is traditionally the strongest season for vehicle purchases in the country, yet this year many showrooms are empty or closed.

Li Ke, a car salesman, said that apart from the Covid-19 pandemic, the 2026 "golden September and silver October" season is the slowest he has seen in 26 years on the job. Speaking to CNBC in his deserted showroom, in a dealership complex on the outskirts of the capital, he described a sharp change. "In past years, customers would come to the showrooms nonstop," he said. "We would have deals to sign every day. But nowadays we see only two to three deals a week. It's a dramatic drop."

Salespeople point to several causes. An unstable job market and a continued slide in property prices have weakened consumer confidence. The government has also scaled back incentives, including cash-for-clunkers subsidies and tax breaks for going electric.

The national figures reflect the gloom. According to the China Passenger Car Association, passenger car retail sales in China reached 13.33 million units through September, down 21.7% from a year earlier. The association expects domestic retail sales for all of 2026 to fall 22% to 18.5 million vehicles, which would be below the level recorded in the first year of the pandemic.

Electric vehicles, once a bright spot, are not immune. Gasoline car sales have been falling for some time as the country shifts toward EVs, but sales of new-energy vehicles, a category that includes EVs, dropped 12.8% from January through September, the association said.

Li said shoppers have become far more cautious. "Customers are watching every penny," he said, adding that buyers weigh what is most practical, economic and worth their money over the long term. "We don't see impulse buying. Because of the bad economy, people are taking more time to replace their cars."

Analysts say the intense competition has produced bruising price wars in recent years, a key reason Chinese carmakers have turned their attention abroad. It is also why Beijing is wary of partners such as the U.S. and Europe erecting coordinated trade barriers against its large volume of car exports.

Broader industrial data shows a mixed picture. China's National Bureau of Statistics reported that industrial profits for the first nine months of the year rose 15.5% from the same period in 2025, though September showed signs of weakness compared with the previous eight months. For auto manufacturing specifically, profits from January to September shrank 22.8% from a year earlier.

Dealerships are adjusting to the squeeze. To preserve cash, Li's operation left a costly streetside location for a space with less foot traffic but a fraction of the rent. With margins eroding, he sees little value in deeper discounts, saying the larger obstacle is the prevailing attitude toward big-ticket purchases. "Chinese buyers would rather wait," he said.