China has the biggest car market on earth. For years, it only went up.
May was the eighth month in a row it went down.
China's main car group sets a sales forecast each year. It just cut that forecast hard.
A few months back, it saw sales slipping about 1%. Now it sees an 11% drop.
That is a big swing in a short time. Sales fell 22.3% in May from a year earlier, to 1.53 million cars.
The slide is not new. Sales are down nearly 20% over the first five months.
That works out to about 7.18 million cars so far. It is a steep step down from last year's pace.
Why the drop? The group blames higher oil prices tied to the Middle East crisis.
Those prices hit demand for gas cars. The group expects a slow recovery later this year.
The boom had run for years. Now it looks like it has run its course.
Buyers are also waiting out a fierce price war. Deep discounts have trained them to expect more.
The bigger issue runs deeper, though. Shoppers are pulling back on big buys.
That clashes with Beijing's goal of economic growth near 4.5% to 5% this year. Weaker confidence is part of it, and smaller subsidies have not helped.
Shifts like this move stocks far beyond China - we unpack what they mean for your money in Market Briefs, every weekday morning, with a free investing masterclass when you sign up.
Here is the surprise. Electric cars and plug-in hybrids are now 62.2% of the market.
Their slump matters more because of that size. They fell 7.5% in May.
That is their fifth monthly drop in a row. They were supposed to be the growth engine.
Analysts say the market has simply grown up. China already sells 23 to 25 million cars a year.
Think of a phone market where almost everyone owns one. New demand gets harder to find.
NIO's chief said it plainly: the easy-growth "golden era" at home is likely over.
Carmakers are not standing still. They are shipping abroad instead.
China's electric and hybrid exports jumped more than 110% in May. Total car exports rose too, up about 75%.
That came even as home sales sank. Selling abroad is now the clear escape valve.
NIO still bets on its home market. Many rivals have turned to exports instead.
Foreign brands feel the squeeze as well. Volkswagen is leaning on Chinese partners to build local EVs.
That split path carries risk. Running new EV brands beside old gas networks is hard to pull off.
China's car boom helped drive global demand for years. A long slump there would ripple across the industry.
The growth story didn't end. It just got on a boat.
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