Chinese electric vehicle stocks plunged today as weak January delivery data exposed a fragile start to 2026 and reignited worries about domestic demand.
Hong Kong-listed EV names such as BYD, Xpeng, Li Auto, NIO and Xiaomi all fell sharply, underscoring how sensitive the sector has become to monthly sales surprises.
BYD numbers tell a tough story
BYD, China’s largest new-energy-vehicle maker, reported 210,051 vehicle deliveries in January, down about 30% year-on-year and roughly 50% from December, marking its fifth straight month of sales declines.
Last month, BYD introduced upgraded new versions of a number of plug-in hybrid models with long-range batteries, with the goal of increasing the appeal of its low-cost hybrids.
Why are investors nervous?
Analysts point to fading policy support and a post-holiday slowdown as key drags. China’s trade in subsidies and other purchase incentives have either expired or been scaled back, dampening short-term demand.
Xpeng Inc (HK:9868) delivered 20,011 vehicles, a 34% decrease from the previous year, while Li Auto (HK:2015) delivered 27,668 units, down 8% year on year. Xpeng shares dropped 9%, while Li Auto fell 4%.
NIO Inc (HK:9866) dropped more than 7%. NIO delivered 27,182 vehicles, nearly doubling the previous year’s total but falling short of December levels, indicating seasonal softness. Xiaomi (HK:1810) shares fell 3% after the EV unit reported around 39,000 deliveries, a monthly record for the brand but still lower than December’s pace, indicating uneven demand across the sector.
Future outlook
Analysts expect further price competition and possible consolidation among smaller EV brands, while investors watch for clearer signs of policy re-stimulus later this year. For now, China’s EV rally looks less like a straight-line ascent and more like a bumpy road shaped by policy, exports, and consumer fatigue.
