Too many similar car models impact China’s auto sales

China’s auto market is suffering from severe product homogenization after automakers flooded the sector with more than 500 new models in the first half of 2026, reports Caixin citing an industry expert.

The rapid proliferation of vehicles with similar functions has exacerbated a cutthroat price war and driven industry profit margins to historic lows, prompting regulators to plan stricter market access mechanisms to force consolidation.

There are currently more than 130 auto brands competing in the Chinese market, many of which are pursuing overly broad product lineups to gain an edge, Fu Bingfeng, vice president of the China Association of Automobile Manufacturers (CAAM), said at an industry forum on Wednesday. However, the deluge of new releases has failed to stimulate demand, with domestic auto sales plunging 21.1% year-on-year to 9.92 million vehicles in the first half of this year, CAAM data showed.