Introduction: By July 2026, the penetration rate of new energy vehicles (NEVs) in China is projected to reach 61%, with NEV growth driving demand for refrigerant R134a in automotive air-conditioning systems. The overall quota consumption progress for the R134a industry stands at approximately 70%, with consumption progress tightly aligned to this year's quota allocation. Within the NEV sector, the industry as a whole is under pressure—experiencing "rising revenue but falling profits" amid sustained price wars—yet production and sales volumes remain at elevated levels, thereby providing solid underlying demand support for refrigerant R134a.
Downstream Demand: NEV Industry Vitality Bolsters R134a Underlying Demand
A review of historical data over comparable periods shows that monthly wholesale sales of new energy passenger vehicles (NEPVs) in China rose from 1.05 million units in August 2024 to 1.282 million units in August 2025, and further to 1.51 million units in August 2026—a cumulative increase of 44% over two years, reflecting robust growth momentum. Notably, however, the broader automotive industry is characterized by a "rising revenue, falling profit" pattern: from January to July 2026, the industry's profit margin stood at only 3.6%, with profits down 20% year-on-year, as sustained price wars continue to compress margins across the value chain. The structural contradiction of "booming wholesale, sluggish retail" continues to accumulate, and channel inventory pressure may affect restocking rhythms in the aftermarket maintenance segment. Nevertheless, the overall impact on R134a's underlying demand is limited: sustained high production and sales volumes imply stable R134a consumption at the vehicle OEM (factory) level, while the aftermarket maintenance sector provides delayed but inelastic demand.
Quota Scarcity vs. Downstream Affordability — The Equilibrium of a Delicate Balance
Recently, mainstream manufacturers in the East China market have maintained firm offers for refrigerant R134a, with market transactions warming up and low-priced inventory largely clearing out. Major fluorochemical refrigerant manufacturers in East China are quoting approximately RMB 65,000–68,000/ton (coordinated between domestic and export sales), while mainstream market offers in East China reference RMB 63,500–65,000/ton (ex-works, tax included). The weekly average price of refrigerant R134a stands at RMB 64,000/ton, with a cost line of RMB 22,636/ton and theoretical profit of RMB 41,364/ton. Weekly average theoretical profit showed a slight decline of 0.32% week-on-week. Aside from the September HF procurement tender pricing rising RMB 300/ton from the previous month's contract level, trichloroethylene market mainstream prices remained flat week-on-week this period; accordingly, the week-on-week change in R134a's average profit was 0.32%.
As the passenger vehicle market enters its traditional off-season, some manufacturers have scheduled annual equipment maintenance, slowing production and sales momentum. The end-market has seen noticeable declines in foot traffic and orders due to factors such as demand front-loading and extreme weather, with raw material consumption following contract volumes based on remaining inventory levels. Consequently, the R134a industry's operating rate stands at nearly 40%, and the restart timeline for previously idled units at mainstream East China manufacturers remains unclear. In the near term, the R134a market is expected to remain in a watchful standoff between supply and demand. Given limited spot availability, prices will likely maintain a high-level sideways trend. As pricing approaches the contractual negotiation stage with downstream equipment manufacturers (OEMs), quota scarcity on the supply side will define the price floor, while downstream affordability will cap the price ceiling. Actual prices will fluctuate between the "floor" and the "ceiling," contingent on inventory cycles and seasonal demand patterns.
Comments
0