China's automotive industry has shed more than a quarter of its workforce in three years, and the decline is set to continue, according to a new report from the China Talent Research Society's Automotive Talent Committee. The findings, reported by the Chinese outlet Huxiu, paint a stark picture of structural change rather than a cyclical downturn.
As of the end of 2025, the industry employed about 16.74 million people. That is down 26.3% from 2022, the committee said. The breakdown shows 6.28 million in upstream parts supply, 2 million in vehicle manufacturing, and 8 million in aftersales services. While upstream and midstream headcounts grew, especially in R&D, the aftersales segment—which includes maintenance, repair and detailing—shrank the most, and that is where nearly 70% of the 8 million aftersales workers are concentrated.
The reason is the shift to electric vehicles. Battery-electric vehicles (BEVs) require less frequent maintenance, have sealed high-voltage systems, and receive over-the-air software updates, so traditional repair work is disappearing. The committee's secretary-general, Li Zhele, said the industry does not need fewer people overall—it needs different people.
Job losses and gains in the EV transition
The committee's model, based on four indicators, forecasts that China's auto sales will reach about 39.88 million units in 2030, with new-energy vehicles (including BEVs, plug-in hybrids, and range-extenders) making up 75.2% of sales and exports hitting 11.8 million units. On that basis, the industry is expected to shed a net 1.78 million jobs over the next five years, a 10.7% decline.
That net figure masks a larger churn: traditional internal-combustion supply chains are set to release about 1.53 million jobs, while new-energy and intelligent-connected segments add only about 660,000—a replacement rate of less than half. The reasons, according to Li, are skill mismatches, an overall imbalance where new jobs do not offset losses, and rising productivity that lets companies produce more with fewer people.
Former committee chair Fu Yuwu pointed to broader industry strains: intense competition, highly homogeneous products, and low overall profitability. The government has stepped in, with ministries including MIIT and the NDRC issuing guidance on anti-involution, minimum pricing, and orderly expansion overseas.
Financial data underscore the pressure. Yang Hong, chairman of avionics supplier Hangsheng Group, noted that from January to July this year, China's cumulative auto retail sales fell 13% year on year—the steepest drop among all major goods categories—and industry profits fell 20%, with profit margins down to about 3.6%. Yang said disorderly competition has led to severe overcapacity, and many small and mid-sized parts suppliers are fighting for survival.
Skills become obsolete faster
Li Zhele warns that the shelf life of skills is shrinking. "What you spent ten years mastering may be worthless by next year," he said. The committee's report also criticizes a talent culture that prizes poaching experienced teams over internal training, inflating salaries and encouraging short-term thinking.
Huxiu's commentary uses a rotating restaurant as a metaphor: just as a diner's belongings shift out of reach as the floor turns, workers who assume their positions are fixed may find the industry has moved on. The article notes that in 2015, about 1,193 auto companies were founded annually in China; by 2023, that had risen to 1,997. More players are entering, but the tide is going out.
For the 16.74 million people in China's auto industry, the message is clear: structural adjustment will not pause for individual reluctance. The question is who can adapt, learn, and find a new place in a sector that is rotating beneath their feet.
