Acloserlookattheworld’slargestsmartEVmarket

McKinseyChinaAutoConsumerInsights2025

September2025

Aboutthereport

ThisreportisbasedonarecentcomprehensivesurveyofChineseautomotiveconsumers.

—Wesurveyed2,498consumersusingonlinesampling.Thesurveyranfromfourthquarter2024tofirstquarter2025.

—Thesamplecovers19majorcitiesacrossChinarepresentingarange

ofdemographicattributes,includingtier-one,-two,-three,and-fourcities,aswellasNorthChina,NortheastChina,EastChina,CentralandSouthChina,SouthwestChina,andNorthwestChina.

—Thereportisdividedintogroupsbyage,incomestatus,car

purchasingexperience,existingcarbrandsandtypes,andmore.

Basedonthecarpurchasingdecision-makingprocess,thereportanalyzesconsumers’attitudes,brandpreferences,purchasing

habits,andcarexperienceindepth.

Authors

MingyuGuan

DanielBirke

ThomasFang

TonyZhou

IIMcKinseyChinaAutoConsumerInsights2025

Introduction

TheChineseautomarkethasmadesignificantprogressonthetransitiontoelectric

vehicles(EVs)sincethetrendstartedinChinaabouttenyearsago.Electrificationand

smartificationhavegainedmomentum,especiallyinthepastfiveyears,andlessonsfromtheChinesemarketcanbeextractedfortheglobalautomotivetransformation.Indeed,thetechnologicalchangesunderwayarenotonlyinfluencingthepreferencesandbehaviors

ofChineseconsumersbutalsoshapingtheevolutionoftheglobalautomotiveindustry.Forthefirsttime,Chineseconsumersaredefiningthedirectionofaglobalindustry.

McKinseyhasfollowedthechangingpreferencesandbehaviorsofChineseauto

consumersandstudiedtheunderlyingdriversofthisevolutionforadecade.Thisreport

drawsontheMcKinseyChinaAutoConsumerSurvey2025torevealfourprimaryinsights(seesidebar,“Aboutthereport”):

I.Competitionisshiftingfrompricetoinnovation.China’sautomotivemarketis

caughtinanescalatingpricewar,butsteepdiscountshaveyieldedonlymarginalsalesgrowth.Incontrast,consumersareactivelyembracingnewmodelsandcutting-edge

technologies.Thisdivergencesuggestsautomakersmayfindmoresuccesscompetingthroughinnovationthanthroughrelentlesspricecuts.

II.Incumbentsarestartingtofallbehindasthelandscapereshuffles.ChineseOEMs

haveearnedconsumerrecognitionintheEVsectorthroughtechnologyinnovation.

Whilemanyincumbentmultinationalbrandsarestillperceivedaspremium,some

arestrugglingtoconverttheirlegacyappealintopricingpowerforEVs.Theseglobal

playersarefacedwiththechallengeofbuildingonthereputationtheyestablished

duringtheinternalcombustionengine(ICE)-onlyeratomeettheneedsoftoday’ssmartandelectrifiedautomotivemarket.

III.Plug-inhybridandextended-rangetechnologieshavebecomemainstreamintheelectrificationtrend.Agrowingnumberofbatteryelectricvehicle(BEV)ownersshowregretabouttheirBEVownershipexperience,becausetheyaredissatisfiedwiththe

chargingexperience.Butplug-inhybridEVs(PHEVs)andextended-rangeEVs(EREVs)aresteadilygainingpopularitybecausetheyofferaneasyrefuelingexperienceanda

practicalsolutiontorangeanxiety.

IV.Technologicaldemocratizationisleadingtoscenario-baseddifferentiation.

Comparedwiththepastfewyears,thisyear’srespondentsshowhigherawarenessofautonomousdriving.Theyknowaboutthetechnology’sadvancedfeatures,express

satisfactionwithitsperformance,andexpecttoseehigher-levelautomation.Assmarttechnologiesbecomemorewidespread,thetrendof“technologicaldemocratization”—whichismakingvehicleswithadvancedtechnicalfeaturesmoreaffordable—is

pushingOEMstoprioritizefeaturesandexperiencesthatfitactualuserscenariosasakeydifferentiator.However,broaderadoptioninChinawillrequireOEMstoeducateconsumerstoensurethatthesefeaturesareusedsafelyandeffectivelygivencurrenttechnologicallimitations.

McKinseyChinaAutoConsumerInsights20251

2McKinseyChinaAutoConsumerInsights2025

McKinseyChinaAutoConsumerInsights20253

Priceofcarcurrentlyowned,RMBthousand

Competition

shiftsfrompricetoinnovation

Keyinsights:

—Aconsiderableproportionofconsumersexpressedadesiretotradeupwhenbuyinganewcartoreplacetheirexistingcars.

—Theeffectofautomakers’pricewarsonboostingsalesisquitelimited,farfrommatchingthemassiveinvestmentrequiredtowagesuchpricecompetition.

—Incomparison,consumersareembracingthe“technologywar,”indicatingthatinnovation-drivenconsumptionisgraduallybecomingmainstream.

ThechangingbudgetdecisionsofChineseconsumerswhenbuyingnewcarshavealwaysbeenanimportanttopicfortheindustry.Oursurveyshowsthatmostconsumers,whenpurchasing

theirnextcars,tendtostayinthesamepricerangeoftheircurrentcars.Still,some20to30percentofconsumerssaytheywanttotradeupfortheirnextcarpurchase(Exhibit1).

Exhibit1

Fortheirnextcarpurchase,mostChineseconsumersstaywithinthesamepricerangeorupgradetoahigherpriceclass.

Stayinthesamerange

Prefertotradeup

Prefertopayless

Highest%group

Budgetfornextcarvspriceofcarcurrentlyowned

%ofrespondents

Budgetfornextcar,RMBthousand

<100

100-149

150-199

200-299

300-400

>400

150-

199

6%

52%

54%

2%

0%

0%

150-

199

3%

25%

50%

17%

0%

0%

200-

299

0%

3%

28%

63%

22%

0%

100-

149

67%

46%

1%

0%

0%

0%

200-

299

1%

2%

45%

81%

3%

1%

100-

149

23%

68%

16%

0%

0%

0%

300-

400

0%

0%

6%

18%

50%

6%

300-

<100

27%

0%

0%

0%

0%

0%

<100

74%

4%

0%

0%

0%

0%

>400

0%

0%

0%

3%

28%

94%

>400

0%

0%

0%

0%

29%

92%

400

1%

0%

0%

17%

68%

7%

20232024

Source:McKinseyChinaAutoConsumerSurveyacrosstheyears

4McKinseyChinaAutoConsumerInsights2025

Wealsofindthatownersofcarsincertainpricerangesaremorelikelytomovetoalowerbudgetrange(thanthecurrentcar)fortheirnextcarpurchasecomparedwith2023(Exhibit2).

Exhibit2

Thepercentageofconsumerswhoplantodowngradeincreasedamongownersofmidpricedcars.

Consumerswhoplantodowngrade,bypriceofcarcurrentlyowned

%ofrespondents,RMBthousand

2022

22

2023

21

20

2024

17

1616

12

10

8

6

4

3

2

1

0

100–149150–199200–299300–400>400

Source:McKinseyChinaAutoConsumerSurveyacrosstheyears

McKinsey&Company

—Fewcarownerswhopaidbetween100,000and150,000RMBfortheircurrentcarswanttodowngradefortheirnextcarpurchase,indicatingastrongwillingnesstoupgradetobettervehiclesamongentry-levelconsumers.

—Ownersofcarsworthmorethan400,000RMBshowedlessinclinationtodowngradethanlastyear,reflectingtheirpurchasingpowerandinterestinnewmodelsandtechnologies.

—However,intheremainingsegments,theproportionofcarownerswhowanttodowngradehassignificantlyincreasedandisclosetothe2022level.Avarietyoffactorscouldbecausingthis.Forexample,aspricecompetitioninChina’spassenger-carmarketintensifies,consumerscannowbuyanewcarwithbetterperformanceandfunctionsatalowercost.Thiswilldoubtless

affectconsumers’budgetplanningfortheirnextcar.

McKinseyChinaAutoConsumerInsights20255

Exhibit3

Althoughthepricingcompetitionescalatedin2024,itresultedinverylimitedadditionalnetdemand.

Question:Doesthepricecompetitionhaveapositiveornegativeimpactonyournew-carpurchasedecision?

Consumerattitudestowardpricecompetition

%ofrespondents

100%

61.3%

Neutral:Hasno

64.1%

impactonpurchasedecision

17.5%

21.1%

Negative:Makesmemorehesitanttomakepurchasedecision

16.4%

19.4%

Positive:Triggersoracceleratespurchasedecision

20232024

Netimpactcaused

bypricecompetition,

positiveviewsminusnegativeviews,%

+3.0%+3.6%

(+0.6p.p.vs

2023)

Source:McKinseyChinaAutoConsumerSurveyacrosstheyears

McKinsey&Company

ThepricingcompetitioninChina’sautomarketisintensifying.InapreviousChinaAutomotive

ConsumerSurvey,wefoundthatconsumerswerelargelyunimpressedbythepricecompetition—thenetstimuluseffectwasonly3percent(calculatedasthepercentageofconsumerswitha

“positive”viewofthepricewar—thosewhofeltitstimulatedoracceleratedtheirpurchasing

decision—minusthosewitha“negative”view,whobelieveditdelayedordiscouragedtheir

decision).Inthisyear’ssurvey,thenetstimuluseffecthasincreasedslightlyto3.6percent(Exhibit3).However,consideringthehugecostsinvolved—discountratesintheICEcarmarketroseby

nearlyeightpercentagepointsin2024comparedwith2023,andthoseintheEVmarketrosebynearlyfivepercentagepoints1—theadditional0.6percentagepointgaininnetstimulusisclearlynotworththeexpense.

1McKinseyanalysisof“Researchonthevolumeandpriceperformanceofthepassengercarmarketin2024,”AutohomeDataPlatform,February20,2025.

6McKinseyChinaAutoConsumerInsights2025

Atthesametime,R&DefficiencyimprovementsarecontinuingtoshortenthereleasecycleofnewmodelsandnewtechnologiesintheChinesemarket.Oursurveyaskedconsumersabouttheir

attitudestowardthistechnologycompetitiontounderstandwhetherithasstimulatedconsumers’interestinnewmodelsandnewtechnologiesorencouragedthemtodelaytheirpurchasebecausetheyexpecttoseebettertechnologiesinthefuture.Theresultsshowthatsignificantlymore

consumersapplaudtheshorterreleasecycleofnewmodelsandtechnologiesthantheydopricecompetition:Thenetstimulusoftheformeris10.8percent,farhigherthanthatofthelatter(3.6percent).Moreover,ashouseholdincomegoesup,thestimulatingeffectofacceleratedR&Dalsobecomesstronger(Exhibit4).Thisindicatesthatconsumersaremoremotivatedbyinnovative

technologiesthanbypricecompetition.

ThetakeawayforOEMsisthatcompetingthroughinnovationismoreeffectivethanengagingin

purepricecompetition.OEMscanshifttoastrategyofprovidingbettertechnologicalfeatures

forthesameprice,whichnotonlybettermeetsconsumers’expectationsbutalsoprotectsOEMs’productsandbrandpositioning.

Exhibit4

Theacceleratedproductdevelopmentcyclehashadasignificantpositiveimpact,especiallyamonghigher-incomeconsumers.

Question:Doestheshortenedcarlaunchingcyclehaveapositiveornegativeimpactonyournew-carpurchasedecision?

Consumerattitudestowardaccelerateddevelopmentcycle

%ofrespondents,householdincomeinRMB

100%

63.9%

64.1%

64.9%

64.3%

6.1%

29.0%

10.3%

25.8%

12.5%

23.3%

16.0%

19.7%

Neutral:Hasno

impactonpurchasedecision

Negative:Makesmemorehesitanttomakepurchasedecision

Positive:Triggersoracceleratespurchasedecision

Netimpact,positive

viewsminusnegative

views,percentagepoints

2024<24,00024,000-48,000>48,000

+10.8%+3.6%+15.5%+22.9%

Source:McKinseyChinaAutoConsumerSurvey2025McKinsey&Company

McKinseyChinaAutoConsumerInsights20257

8McKinseyChinaAutoConsumerInsights2025

Incumbentsstarttolagbehind

Keyinsights:

—Thenumberofbrandsinconsumers’initialconsiderationsets(ICSs)hasincreasedbutisstillfarlessthanthenumberofnewbrands.

—Whileleadingmultinationalbrandsmaintainanadvantageinpremiumandluxury

recognition,theyhavefailedtotranslatethisadvantageintosalespremiums.

—DisruptorbrandshavegainedextremelyhighconsumerawarenessintheEVmarket,outperformingtheirincumbentcounterparts.

—ChineseOEMshaveearnedrelativelystrongconsumerrecognitionontechnology-relateddimensions.

Newbrandsareincreasinglypartofconsumers’initialconsiderationset

AsthecompetitioninChina’sautomarketintensifies,severalleadingattackershavegained

considerabletraction,whilesomeincumbentbrandsarestrugglingtocompete.Since2021,20newbrandshaveemerged(eachofwhichhasmonthlysalesexceeding1,000units),whilenineincumbentbrandshaveexitedthemarket(Exhibit5).

Whenconsumerswanttopurchaseacar,theycreateanICS,collectmoreinformationabouteachbrandinthatset,andmaketheirfinalpurchasedecisions.Howwillconsumers’ICSs

changeasmorenewbrandsemerge?

Thesurveyfindsthattheaveragenumberofbrandsinconsumers’ICSsisstilllowdespitethe

additionofasignificantnumberofnewpassenger-carbrandsintheChinesemarket.From2021to2024,thenumberofbrandsincludedinanaverageICSincreasedfrom2.5to3.4(Exhibit6).

Exhibit5

Inthepastthreeyears,20newbrandshavebecomeavailabletoconsumers.

Passenger-vehiclebrandsinChina

Numberofbrands1

81

Numberofunits,

thousands

>1,200

600-1,200

240-600

3

70

3

9

7

8

20

9

10

14

17

120-240

13

15

60-120

33

19

12-60

2021ExitedNew2024

1.Includingallbrandswithsalesofmorethan12,000unitsinChinain2021and2024;brandnumbersplitbyannualsalesvolume.Source:ChinaNewCarInsuranceRegistrationDatabase

McKinsey&Company

McKinseyChinaAutoConsumerInsights20259

Exhibit6

Theaveragenumberofbrandsinconsumers’initialconsiderationsetsremainslowdespitetheadditionof20newbrandstotheChinesemarket.

Brandsininitialconsiderationset(ICS)FinaltransactionswithinICS

Numberofbrands

2.8

2.5

3.42.9

All

respondents

3.0

2.7

3.53.0

<1-yeargroup1

3.3

2.7

2.62.1

>3-yeargroup2

202122232024

%

2023

2024

2022

98%

87%

90%85%

77%

79%

ICE3ownersEV4owners

1.Surveyparticipantswhoboughttheircarinthe12monthspriortothesurvey.

2.Surveyparticipantswhoboughttheircaratleast3yearsbeforethesurveyandplantobuyanewoneinthenext12months.

3.Internalcombustionengine.

4.Electricvehicle.

Source:McKinseyChinaAutoConsumerSurveyacrosstheyears

McKinsey&Company

Thesurveyindicatesthat98percentofICEbuyersandcloseto90percentofEVbuyersenduppurchasingbrandsfromwithintheirICSs.Inotherwords,nomatterhowhardabrandworkson

productdefinition,R&D,procurement,andproduction,thoseeffortsarenotlikelytobereflectedinsalesunlessconsumersarealreadyinterestedinthatbrand.

TheshareofEV-onlybrandsinanICSincreasedforrespondentswhopurchasedtheircurrentcarsatleastthreeyearsagoandplantobuyanewoneinthenextyear(Exhibit7),whethertheycurrentlyownEVorICEcars.

10McKinseyChinaAutoConsumerInsights2025

Exhibit7

Brandsthatproduceonlyelectricvehiclesareincreasinglypopularamongtheinitialconsiderationsetsofexperiencedcarbuyers.

Brandsinbuyers’ICSs1

Numberofbrands

2.62.1

3.32.7

All

ICE

owners

2.6

3.42.8

2.2

ICE2

owners

2.6

3.32.6

1.9

EV3

buyers

232024

22

2021

RespondentswithEV-onlybrands4inICS,%

50

41

41

11

90

76

57

EV

owners

29

202122232024

1.“Buyers”includessurveyparticipantswhoboughttheircaratleast3yearsbeforethesurveyandplantobuyanewoneinthenext

12months.ICSisinitialconsiderationset.

2.Internalcombustionengine.

3.Electricvehicle.

4.BrandsthatmanufactureonlyEVcars.

Source:McKinseyChinaAutoConsumerSurveyacrosstheyears

McKinsey&Company

—TheproportionofEVownerswithEV-onlybrandsintheirICSgrewfromlessthan30percentin

2021to90percentin2024.

—TheproportionofICEownerswithEV-onlybrandsintheirICSincreasedfromabout10percentin2021to50percentin2024.Thatis,halfofrespondentswhopurchasedtheircurrentICE

carsatleastthreeyearsagoandplantobuyanewcarinthenextyearincludedEV-onlybrandsintheirICS.

McKinseyChinaAutoConsumerInsights202511

ShiftingICSsreflecttheevolvinglandscapeofChina’spremium-carmarket.Weanalyzedthe

percentageofpremiumGermanbrands(Benz,BMW,andAudi)andemergingpremiumEVbrands(includinganAmericanbrandandsomeleadingChinesebrands)inconsumers’ICSs(x-axis:

percentinconsideration),aswellasthepercentageofbuyerswhoinitiallyincludedthemintheirICSandultimatelypurchasedone(y-axis:percentofwinning).

—BecausecompetitivedynamicsvarybetweentheoverallmarketandtheEVmarket,brandperformancebetweenthetwomarketsalsovaries.

—PremiumGermanvehicleshavemuchbetterICSperformanceintheoverallmarketthanintheEVmarket(Exhibit8).

Exhibit8

MajorpremiumGermanbrandsperformpoorlyoninitialconsiderationsetswithintheelectricvehiclespace.

PercentageofICS-enteringvseventualwinninginsales;forafewbrandsonly1;forrecentcarbuyers(<1year),2024

%inwinning2

60

40ICSperformanceof3

majorpremiumGermanbrandsinEVmarket

Aggregated(inclICEandEV3owners)OnlyEVowners

ICSperformanceofthe3major

premiumGermanbrandsin

aggregatedmarket(ICEandEV)

20

0

1020304050

%inconsideration4

Note:ICSisinitialconsiderationset.

1.WeightedaverageperactualpremiumEVsalesmixin2024of3majorpremiumGermanbrands,1premiumUSEVbrand,and3premiumChineseEVbrands.

2.PercentageofbuyerswhoultimatelypurchasedabrandintheirICS.

3.ICEisinternalcombustionengine.EViselectricvehicle.

4.Percentageofbrandsincludedinconsumers’ICSs.

Source:McKinseyChinaAutoConsumerSurvey2025

McKinsey&Company

12McKinseyChinaAutoConsumerInsights2025

—ThisdifferenceshowsthatalthoughleadingpremiummultinationalbrandshadastrongreputationintheICE-onlyera,theystruggletoleveragethisreputationtosellEVs.

WealsofindthatbuyersofpremiumGermanandpremiumChineseEVsaremorelikelytoincludeeachother’sbrandgroupsintheirICSs:In2024,21percentofpremiumChineseEVbuyers

includedpremiumGermanbrandsintheirICS,upfrom12percentin2023.Only7percentof

premiumGermanbrandbuyersincludedpremiumChineseEVbrandsintheirICSin2023,butthisnumbersoaredto40percentin2024(Exhibit9).

Exhibit9

BuyersoftraditionalpremiummultinationalvehiclesareincreasinglylikelytoconsiderpremiumChineseelectricvehicles.

2024

2023

Initialconsiderationsetofownerswhoboughttheirvehiclelessthan1

yearago,%ofrespondents3majorpremiumGermanbrands,%PremiumChineseEVbrands,%

3majorpremiumGermanbrands

PremiumChineseEVbrands

3majorpremiumGermanbrands

PremiumChineseEVbrands

Brandpurchased

100%

40%

(+33p.p.1vs2023)

21%

(+9p.p.1vs2023)

93%

7%

95%

91%

12%

1.Percentagepoints.

Source:McKinseyChinaAutoConsumerSurveyacrosstheyears

McKinsey&Company

Asimilartrendappearsinthemasssegment(Exhibit10).Fifty-sixpercentofmass-Chinese-

brandbuyersincludedmassmultinationalcarbrandsintheirICSs,slightlyhigherthanin2023(43percent).Andwhileonly49percentofmass-multinational-brandbuyersincludedmassChinesebrandsintheirICSsin2023,thissoaredto70percentin2024.Inotherwords,sevenoften

buyersofmassmultinationalbrandsconsideredbuyingamassChinesebrand.ThisposesahugechallengetothemarketinganddealersystemsofmultinationalOEMs.

McKinseyChinaAutoConsumerInsights202513

14McKinseyChinaAutoConsumerInsights2025

Exhibit10

Chinesebrandsarerapidlygainingtractioninthemasssegment.

2024

2023

Initialconsiderationsetofownerswhoboughttheirvehiclelessthan1yearago,%ofrespondents

Massmultinationalbrands,%MassChinesebrands,%

Mass

multinationalbrands

MassChinesebrands

Brandpurchased

99%

70%

(+21p.p.1vs2023)

56%

(+13p.p.1vs2023)

97%

49%

Mass

multinationalbrands

MassChinesebrands

98%

95%

43%

1.Percentagepoints.

Source:McKinseyChinaAutoConsumerSurveyacrosstheyears

McKinsey&Company

Perceptionofpremiumandluxurybrands

Oursurveyincorporatedquantitativeresearchonbrandperception.Specifically,wecategorizedautomotivebrandsintofivetiers:entrylevel(onepoint),volumesegment(twopoints),near-

premium(threepoints),premium(fourpoints),andluxury(fivepoints).Respondentswereaskedtoclassifybrandsbasedontheirperceptions(Exhibit11),whichledtosomekeyfindings:

Exhibit11-a

Multinationalbrandskeeptheiradvantageinpremiumandluxuryrecognition,butChinesebrandsarestartingtogaintraction.

Question:Whichpositionmatchesthegivenbrands?

MultinationalChinese

Consumerperceptionofdifferentbrands’position(regardlessofpowertraintype)1

4.8

4.84.6

4.8

Luxurygroup

4.5

4.5

3.93.83.83.7

3.9

3.7

3.6

3.5

3.5

3.4

3.2

Premiumgroup

3.2

3.1

3.1

3.0 2.92.92.9

2.82.82.7

2.72.7

2.7

1.Weightedaveragescoreofeachbrand(luxury,premium,near-premium,volumesegment,entrylevel,ratedfromhightolowas5,4,

3,2,1pointsrespectively).

McKinseyChinaAutoConsumerInsights202515

Exhibit11-b

Multinationalbrandskeeptheiradvantageinpremiumandluxuryrecognition,butChinesebrandsarestartingtogaintraction.

Question:Whichpositionmatchesthegivenbrands?

Massgroup

2.22.2

2.12.0

1.91.91.91.91.91.91.9

1.81.81.7

1.61.6

1.5

1.51.41.41.4

1.4

1.3

1.31.2

Multinational

Chinese

1.Weightedaveragescoreofeachbrand(luxury,premium,near-premium,volumesegment,entrylevel,ratedfromhightolowas5,4,

3,2,1pointsrespectively).

Source:McKinseyChinaAutoConsumerSurvey2025

McKinsey&Company

—Chineseconsumersdifferentiateautomotivebrandsintothreedistinctclusters:luxury,premium,andmass.

—Incumbentbrandsdominateallluxurypositions.

—Incumbentbrandsmaintainsignificantadvantagesinthepremiumcluster,indicating

sustainedconsumerrecognitionoftheirdecades-longbrandequitydespitechallengesfromelectrificationandsmartification.

—Severaldisruptorbrandshaveenteredthepremiumcluster,butmostofthemlagbehind

incumbents.Notably,onedisruptorleadstheentirepremiumcluster,highlightingitssuccessinbrandingandcompetitiveness.

—Disruptorbrandsdominatethemasscluster,outperformingincumbentcompetitors.

16McKinseyChinaAutoConsumerInsights2025

McKinseyChinaAutoConsumerInsights202517

Weaskedrespondentswhatdefinesapremiumcarbrandinanefforttoidentify“musthave”

and“nicetohave”factorsamongattributessuchasbrandheritage,safety,andmaneuverability(Exhibit12).

Exhibit12

Brandheritageisseenasthemostimportantfactorindefiningapremiumcarbrand,butitsleadingadvantageismarginal.

Question:Whatdefinesapremiumcarbrand?,%ofrespondents

Must-have

Nicetohave

Importanceoffactorindefiningapremiumcarbrand,%ofrespondents

Brandheritage

Safety

Maneuverability

Comfort

Powertrain

Vehiclequality

Servicequality

Smartcabin

Autonomousdriving

Good-looking

Customization

Racingperformance

Sustainabilityandsocialresponsibility

OriginatedfromdevelopednationssuchasEU,US,orJapan

52

44

31

79

35

46

77

32

77

55

22

50

76

76

75

27

46

30

53

49

48

23

74

73

25

25

51

71

19

52

70

18

68

47

22

49

66

17

53

41

12

83

Source:McKinseyChinaAutoConsumerSurvey2025McKinsey&Company

—“Strongbrandheritage”rankedasthemostimportantfactorinapremiumautomotivebrand.

However,whencomparedwithsubjectivefactorssuchassafety,maneuverability,comfort,andpower,theleadingadvantageofbrandheritage,apurelyemotionalfactor,isnotsignificant(forexample,theratingofbrandheritageisonlyfourpercentagepointshigherthanthenumber-

twofactor,safety).

—ThisexplainswhyoneChinesebrand,despitebeingnewlyestablished,couldtaketheleadin

thepremiumsegment.Althoughthisyoungbranddoesn’thavemuchbrandheritage,itcanrideonthetechnologicalstrengthsofitsparentcompany.Thisbrandhasachievedrevolutionary

breakthroughsinsafety(forexample,sailinginthewater),maneuverability(suchastank-

liketurning),comfort(suchassignificantperformanceenhancementenabledbysuspensionbreakthroughs),andpower(morethan1,000horsepower),therebygaininghigherrecognitionfromconsumers.

—Intermsofmust-haves,brandheritagerankslowerthanmoresubjectivefactorssuchassafetyandmaneuverability.Thisagainillustratesthattheleadingadvantageofbrandheritageover

rationalfactorsisnotstable.

—Amongallfactors,“originatedfromdevelopednationssuchastheEuropeanUnion,UnitedStates,orJapan”isregardedastheleastimportant.

Atthesametime,wealsofoundthattheimportanceofbrandheritagevariesamongrespondentsfromdifferentbackgrounds.Relativelyspeaking,respondentsfromlower-tiercitiesandowners

oflow-pricedmodelsaremorelikelytoassignimportancetobrandheritage(Exhibit13).This

indicatesthathigh-incomeconsumersandresidentsofhigh-tiercitiesarelessinfluencedbythepurelyemotionalfactorofbrandheritageandcaremoreaboutotherfactors.Thisshiftmayspreadtootherconsumers,giventhatconsumptiontrendsinChina’sleadingtier-onecitiesareseenasaleadingindicatorforthewholecountry.

Asmentionedearlier,incumbentautomotivebrandsgenerallyenjoyhigherrecognitionaspremiumorluxurybrandsthantheirdisruptorcounterparts.However,thishasnottranslatedintohigher

priceadvantagesinthemarket.Traditionally,Chineseconsumershavebeenwillingtopaya

higherpremiumforforeignbrands,butthistendencyhasdiminishedinrecentyears:50percent

ofrespondentssaidtheywerenotwillingtopayahigherpremiumformultinationalpremiumEVs

thanforChineseones—onparwith2023buthigherthan2022(47percent).Amongthosewillingtopayapremium,mostarewillingtopayonlyaverylimitedamount,withonly3percentindicatinga