Following BYD, the competition for the second spot between Chery and Geely has become fiercer.

In September, Chery sold 292,308 vehicles, while Geely sold 292,168, as per official data from both companies.

Overall, Chery outsold Geely by a mere 140 units, but a deeper analysis reveals notable structural differences.

Out of Chery's 290,000 vehicles, 208,000 were exported, representing 70% of its total sales.

In contrast, Geely exported 107,000 out of its 290,000 vehicles, less than 40%.

This suggests that Chery's market focus has shifted more towards overseas markets than the domestic one.

Chaoyang Self-Made: Comparison of China's Top Three Automakers

Over the past 23 years, Chery has sold vehicles in over 130 countries, with cumulative exports exceeding 7 million units, making it the first Chinese automaker to reach this milestone.

However, domestically, Chery sold 283,000 units in China in September, 3.4 times less than BYD, and only 656,000 units in the first nine months of the year, when compared to BYD.

Can Chery sustain its future solely through overseas growth?

Does Chery still aim to dominate the domestic market?

What Drives Its Export Leadership?

In the first three quarters of this year, Chery Group exported a cumulative 1.551 million units, a 65.6% increase year-on-year, already surpassing its total exports projected for 2025.

In September alone, Chery exported 208,000 units, marking the second time this year that monthly exports exceeded 200,000 units.

On average, a 'Chery-made' vehicle is exported every 15 seconds.

Chaoyang Self-Made: Chery's Export Performance

With a global cumulative user base of over 20 million, including 7.39 million overseas, one in every three Chery owners is based outside China.

In terms of export quality, according to Gasgoo Automotive Research Institute, in June this year, Chery's top export region for passenger cars was the 'EU + UK + EFTA,' with 65,000 units sold in a single month.

Ranking first in the EU carries more weight than leading in total export volume, given the EU's stringent global entry standards and certifications.

In the first eight months of this year, Chery sold 234,000 units in 24 European countries, a 193% increase year-on-year. In August, it topped the UK's new car brand sales chart with 8,618 units and retained the top spot in September, with the JAECOO 7 also claiming the top spot in the UK's monthly overall vehicle sales chart. In the UK, one in every 10 new cars sold is from Chery.

Source: Chery JAECOO 7

A report by CAICT shows Chinese brand sales in the European market in the first half of 2026: MG 181,000 units, BYD 174,000 units, Jaecoo 60,000 units, Omoda 53,000 units, and Chery 40,000 units.

Combining Chery's three brands in the European market, sales reached 153,000 units, closely trailing MG and BYD. Overseas, Chery employs a typical 'wolf pack' strategy.

Chaoyang Self-Made: First Half European Market Comparison

Chery's revenue structure has also evolved with its overseas market growth.

In its 2026 interim report, Chery's revenue reached 143.28 billion yuan, with overseas revenue at 98.97 billion yuan, accounting for 69.1%.

Additionally, overseas passenger car gross margins are higher than in the Chinese market, boosting the company's overall gross margin from 13.0% to 16.1%.

Source: Chery Interim Report

In 2026, when the average profit margin in vehicle manufacturing is only about 1.5%, Chery achieved a net profit margin of 6.29%, relying on high overseas margins and an improved new energy product mix.

The capital market also recognizes Chery's overseas achievements.

In mid-October, Chery Automobile's total market value was approximately 140 billion Hong Kong dollars.

J.P. Morgan initiated coverage with an 'Overweight' rating, listing it as a 'top pick for Chinese passenger vehicles.'

Chery's Overseas Challenges: Advantages No Longer Clear-Cut

In its 23 years of overseas expansion, Chery initially targeted markets with low barriers, weak competitors, and high demand for fuel vehicles.

After two decades, it has become China's top export brand.

According to General Administration of Customs data, China exported 8.63 million vehicles in the first nine months of this year, becoming a major player and triggering trade protection in multiple markets.

As overseas markets enter 'deep waters,' the competitive landscape for automakers must evolve.

Firstly, in terms of overseas market growth, BYD and Geely are rapidly closing the gap with Chery.

Chery exported 1.5512 million units from January to September, a 65.6% increase year-on-year. BYD's overseas sales reached 1.343 million units, a 92.7% increase year-on-year, with the absolute gap narrowing.

BYD's overseas growth is significantly higher than Chery's, and at the current rate, Chery's position as the top exporter may not last long.

Chaoyang Self-Made: Chery Exports vs. BYD

Besides BYD, Geely is also catching up. In September alone, Geely exported 107,000 units, a 162% increase year-on-year, exceeding 100,000 units for the fourth consecutive month. From January to September, Geely's cumulative overseas sales reached 798,000 units, a 169% increase year-on-year.

The gap between Geely's overseas market and Chery's is visibly narrowing.

Secondly, the product mix in overseas markets is crucial.

While Chery exports a large volume, nearly 70% of its exports are still fuel vehicles.

In the first half of this year, new energy vehicles accounted for about 30% of Chery's overseas sales, compared to nearly 60% for Geely and almost entirely new energy for BYD. Against the backdrop of global fuel vehicle contraction, Chery's new energy exports have not kept pace.

Thirdly, and most importantly, Chery's overseas factory layout is somewhat lagging.

In March this year, the European Commission introduced the 'Industrial Accelerator Act,' requiring over 70% localized components for new energy vehicles to be produced within the EU and limiting foreign ownership to no more than 49%.

The EU is also adopting a 'joint venture' model, similar to what China did in the past, with similar measures from Russia and Brazil.

Chaoyang Self-Made: Challenges in Chery's Key Markets

At such times, long-term overseas development requires building factories or local joint venture models, areas where Chery lacks competitive advantages.

Take Southeast Asia, a traditional stronghold for Chery, as an example:

BYD's Rayong plant in Thailand has an annual capacity of 150,000 units, with a localization rate of about 92%, and its Subang plant in Indonesia commenced operations in September.

Chery's planned capacity in Rayong, Thailand, is 'at least 80,000 units/year,' with initial production of 50,000 units/year starting in April this year, expanding to 80,000 units by 2028, appearing somewhat lagging.

Source: Thailand Plant Commissioning

Chery's interim report states: Chery operates 12 major production bases globally, with 3 overseas.

In comparison, Geely has 12 overseas factories, all outside China; BYD plans 14 factories with a total capacity of 1.56 million units/year.

Chaoyang Self-Made: Overseas Capacity Planning of China's Top Three Automakers

As overseas factory building becomes a trend and the option of 'shipping vehicles or knock-down kits for sale' is closed off in multiple markets, how long can Chery's first-mover advantage last?

Domestic Market Crucial, Chery's 'Divided Forces' Strategy Raises Concerns

Back in the domestic market, Chery sold about 84,500 units in September, less than half of its exports.

BYD sold about 283,000 units in the same period, 3.4 times Chery's volume; Geely sold about 185,000 units, 2.2 times Chery's.

However, the overall domestic passenger car market declined by 19.2% in the first half.

Given the intense domestic competition, Chery's choice to contract cannot be deemed wrong.

But the line between 'survival' and 'falling behind' is narrower than imagined.

From trends in new energy, battery technology, and intelligent driving technology, it is clear that for the next five years, the technological high ground of the global auto industry will be in China.

If automakers lose their domestic home field, they lose the opportunity to refine their competitive edge.

Domestically, Chery faces dual challenges: it cannot reach the premium segment and suffers from internal cannibalization.

Firstly, channel infighting is prevalent, with 'eight children fighting over one bowl of rice.'

Excluding Jetour, Chery's five brands operate eight entirely independent sales networks, with highly overlapping pricing, all crowded in the 100,000 to 250,000 yuan range.

Chaoyang Self-Made: Chery's Sales Network

Different brands compete for customers, and internal cannibalization occurs within the same brand's two channels.

This is a 'recurring issue' for Chery.

In 2009, Chery indiscriminately added brands, leading to stagnant sales and a decline, prompting an urgent 'return to one Chery' in 2012.

Over a decade later, the 'old issue' has resurfaced.

The Fengyun A8 and Arrizo 8 overlap in positioning, while Jetour and iCAR compete in the 150,000 yuan segment.

Secondly, Chery severely lacks a premium presence, with its unit price ceiling serving as its profit ceiling.

In the second quarter of this year, Chery's average vehicle price was about 109,000 yuan (group consolidated revenue of 77.41 billion yuan ÷ total sales of 709,000 units, including commercial vehicles). According to Soochow Securities, excluding Russian factors, it was 117,000 yuan.

Chaoyang Self-Made: Average Vehicle Prices of Major Automakers in Q2 (inconsistent calculation methods)

In the same period, BYD's average revenue per vehicle was 136,000 yuan, Geely's 126,000 yuan, Li Auto's 245,000 yuan, Seres' about 294,000 yuan, and NIO's about 406,000 yuan.

Compared to these, Chery's average price is about 27,000 yuan lower than BYD's and about 17,000 yuan lower than Geely's, less than half of Li Auto's and a quarter of NIO's.

Although calculation methods vary, Chery's generally lower unit prices are evident.

Thus, Chery currently relies on scale to drive total revenue, with an interim revenue of 143.28 billion yuan, but its 6.29% net profit margin already includes contributions from high overseas margins, and domestically, it may be even lower.

During the fuel vehicle era, Chery's average price long hovered between 80,000 and 100,000 yuan, with brand perception stuck on 'cheap, durable, and functional.'

In the new energy era, it has climbed to just over 110,000 yuan but still lags behind industry averages.

While BYD uses Tengshi to probe the 300,000 yuan segment and Fangchengbao for off-road models, and Geely uses Zeekr to stabilize at 370,000 yuan with Lynk & Co's new energy models accounting for 65%, Chery remains stuck in the most crowded 100,000 to 150,000 yuan segment.

Technological investments fail to recoup costs, and brand premium cannot be established, forcing continued reliance on volume for revenue and overseas markets for profit.

Chery's premium journey has also been rocky.

Its representative brands are Jetour and Exeed. In September, Jetour sold 5,008 units, down 36.5% year-on-year; Exeed sold 4,905 units, down 54.6% year-on-year.

Source: Chery Announcements

Not much needs to be said about Jetour, as consumers remember 'Huawei Jetour,' not 'Chery Jetour.' Borrowed ladders ultimately belong to others.

The 'biological' Exeed faces more pronounced issues.

Debuting at the 2017 Frankfurt Auto Show, Exeed carried Chery's premium dreams. Seven years later, Exeed sold only 41,600 units in the first seven months of 2026, down 39.3% year-on-year. With seven leadership changes in seven years,

its brand positioning has fluctuated repeatedly. When its first model failed to sell, it introduced a cheap 99,900 yuan version, embedding the perception of 'high-spec Chery.'

With the group prioritizing Jetour as a top-tier strategy, Exeed's resources dwindled, and in July 2025, it was downgraded from an independent brand to a business division.

Thus, the issues of the domestic market and premiumization are two sides of the same coin.

Losing domestic market share dissipates scale effects and thins cost advantages; failing to ascend to premium segments prevents brand premium from being established, leaving profits reliant on overseas markets alone.

Overseas markets can sustain today's profits but not tomorrow's brand. Chery cannot afford to lose its domestic home field.

Source: Chaoyang Capital Theory