Toyota, Honda, Nissan post steep China sales drops in H1

Toyota, Honda ↗ 0.20%, and Nissan all posted steep year-on-year sales drops in China during the first half of 2026, underscoring how rapidly Japanese automakers are losing ground in the world's largest car market to domestic electric vehicle makers.

The Numbers

Toyota's China sales totaled 694,700 units in the first half, down 17.1% year-on-year, while Nissan sold 237,000 units, a 15.0% decline. Honda fared worst among the three, with its China volumes collapsing amid a broader restructuring that has seen it shut factory lines and discontinue multiple models. Honda's April sales alone fell 48.3% year-on-year to just 22,595 units, with cumulative January-to-April figures down 28%.english.news18a+2

The Japanese manufacturers' struggles mirror a broader market downturn. Domestic passenger vehicle sales in China fell 23.4% year-on-year in June to 1.62 million units, marking the ninth consecutive month of decline, according to Reuters. Only 12% of Chinese dealerships completed their first-half sales targets on schedule, according to the China Automobile Dealers Association.reuters+1

The EV Gap

A report released on July 5 by the China Association of Automobile Manufacturers highlights the structural challenge facing legacy automakers. The average age of new energy vehicles on Chinese roads is just 1.8 years, compared to 8.2 years for internal combustion engine passenger vehicles. The data point illustrates how recently most Chinese consumers adopted EVs — and how quickly the transition has occurred.english.news18a+1

Japanese manufacturers have been slower to shift toward fully electric vehicles, leaving them exposed in China and increasingly in Southeast Asia, where Chinese brands are also expanding. Chinese automakers sold nearly 27 million vehicles globally in 2025, surpassing Japan's approximately 25 million and claiming the global sales lead for the first time in over two decades.finance.yahoo+1

Restructuring Underway

Honda is already taking drastic action. GAC Honda's Huangpu factory in Guangzhou, which produced models including the ZR-V and Fit, was scheduled to cease production in June 2026, while Dongfeng Honda's Wuhan plant is set to close in 2027. The company's China sales have fallen from roughly 1.66 million units in 2020 to around 650,000 vehicles.carnewschina+1

Toyota's global sales, including subsidiary Daihatsu, fell 7.4% in the most recently reported month, with China and the Middle East cited as key pressure points. The outlook remains challenging as Chinese consumers continue migrating to domestically produced EVs at a pace that shows no sign of slowing.finance.yahoo