The surge in electric cars in China is mainly driven by hybrids.

• Despite a shift away from gas-only cars, full-year data indicate that hybrid-powered vehicles are more popular in China than battery-only ones.
• In 2024, BYD, the market leader, reported that more than half of the 4.3 million passenger cars it sold were hybrid-powered, marking a significant shift from the previous year.
• In 2024, Chinese electric car startups that exclusively sold battery-powered vehicles had lower sales compared to companies that also offered hybrid models.

In China, hybrid-powered vehicles are gaining popularity among consumers, despite a shift away from gas-only cars, according to full-year data.

In a filing Wednesday, BYD, the market leader, announced that it sold approximately 4.3 million passenger cars in 2024. This was a significant increase from the previous year, when BYD sold around 2.5 million hybrid-powered vehicles, a reversal from 2023 when it sold slightly fewer hybrid cars than battery-only vehicles.

Elon Musk's car company is expected to release 2024 figures in the U.S.' morning hours on Thursday.

Despite growth in the Chinese market for battery electric vehicles, Joe McCabe, president and CEO of AutoForecast Solutions, predicts that demand for internal combustion engine-based vehicles, including hybrid-powered cars, will continue by 2031.

Last year, Tesla delivered a record 500,508 vehicles, with the majority of its cars featuring a fuel tank to extend the battery's driving range.

In 2024, the Chinese partner, which sells both battery and hybrid-powered cars, delivered nearly 300,000 cars and aims to deliver 500,000 in the year ahead.

Chinese electric car startups that have only sold battery-powered vehicles ranked lower in full-year deliveries. Electric carmakers sold 222,123, 221,970, and 190,068 battery-powered vehicles.

The second half of 2024 saw the commencement of deliveries for the lower-priced brands of Nio and Xpeng, which are included in their final tally for the year.

In November, Xpeng unveiled its hybrid range-extender system, while Zeekr announced plans to launch its first hybrid vehicle in 2025.

In the past year, electric car brands faced increased competition with Xiaomi launching its SU7 electric sedan in March. By the end of December, Xiaomi had already delivered over 135,000 cars and set a target of delivering 300,000 cars by 2025.

Zeekr aims to achieve 320,000 deliveries in 2025, following a slight miss of its reported target of 230,000 cars in 2024.

Rapid increase in new energy cars

In July, China's efforts to promote electric cars reached a milestone as new energy vehicles made up over half of all passenger cars sold that month, according to the passenger car association. These vehicles are powered by batteries or a combination of batteries and gasoline.

The penetration rate remained constant from July 2023 to November, with a rate of 52.3% in November, according to association data.

McCabe stated that China's market growth for new energy vehicles is driven by local incentives, which is part of the country's strategy to strengthen domestic players rather than relying on foreign brands.

Beijing and other cities are simplifying the process of obtaining license plates for new energy vehicles compared to traditional gas-powered cars. As part of China's recent initiatives to increase demand, the government has been offering subsidies on new energy vehicle purchases.

In the U.S., light-duty vehicle sales in the second quarter were driven by hybrids, resulting in a combined penetration of hybrid and battery-electric cars of 18.7%, according to Wards Intelligence data from the U.S. Energy Information Administration.