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Consumers have shown significant enthusiasm for online car sales, but offline touchpoints remain indispensable.

OEMs must offer omnichannel operations and focus on improving the customer experience.

OEMs that want to build a sustainable, long-term advantage in the Chinese market must also strengthen all aspects of their customer operations. Also, EV owners are highly satisfied with the overall performance of their vehicles, which demonstrates great growth potential for EV penetration. EV customers are more inclined to consider vehicle performance, rather than regulatory incentives such as free license plates, when purchasing a vehicle.

Customer loyalty to EVs is emerging, and focusing on customer operations is essential for OEMs.

Four of the five most recognizable EV brands are Chinese, while the most recognizable ICE brands are still foreign brands. The survey also revealed that brand awareness differs for electric vehicles (EVs) and traditional internal-combustion-engine (ICE) vehicles. Chinese consumers have long been willing to pay a premium for foreign brands, but this attitude is shifting as changes within China’s brand landscape accelerate.

Multinational brands no longer command premium prices, and changes in the overall brand landscape are accelerating.At the same time, an increasing number of consumers are making more rational choices because OEMs have introduced many cost-effective models with high-quality features, giving buyers more options with better overall value. High-priced models continued to increase their market share because, as shown in our survey, more than half of Chinese consumers are interested in vehicle trade-ups. Trading up continues to be popular, but some consumers are making more rational choices about their next car purchase.To gain more insight about the consumer perspectives in this critical market, we conducted the McKinsey China Auto Consumer Insights 2023 survey.

These changing preferences, in turn, could reshape the country’s automotive market over the next five to ten years. Within China, these changes are having a dramatic impact on consumer preferences for vehicles. Four major trends-autonomous driving, connectivity, electrification, and shared mobility (ACES)-are transforming the automotive industry worldwide.