News on January 4: BYD released its production and sales report for December 2025, reporting a sales volume of 420,398 new energy vehicles in December, a year-on-year decrease of 18.2%. The cumulative sales for the whole year of 2025 amounted to 4,602,436 vehicles, a year-on-year increase of 7.73%. Among them, the sales volume of pure electric models was 190,712 in December; the cumulative sales of pure electric models for the whole year reached 2,256,714, a significant year-on-year increase of 27.86%. In December, the overseas sales of passenger cars and pickups amounted to 132,800 vehicles, with the annual overseas sales exceeding 1 million vehicles. Among its sub-brands, Fangchengbao sold 234,600 vehicles throughout the year, while Denza sold 157,100 vehicles. The data shows that BYD topped the global annual electric vehicle sales list in 2025, replacing its American competitor Tesla. Tesla announced on Friday that its delivery volume in 2025 was 1.64 million vehicles, which is consistent with the company's previous estimate of 1.6 million vehicles. This figure represents an 8.6% decrease compared to 2024, marking the second consecutive year of declining delivery volume for the company. BYD's sales of pure electric vehicles in 2025 increased by nearly 28% year-on-year, reaching 2.26 million vehicles. Tesla's vehicle deliveries in the fourth quarter of 2025 amounted to 418,227, a decrease of about 16% compared to the fourth quarter of 2024.
In the fourth quarter of 2025, driven by the dual forces of self-discipline in reducing emissions and cost support amidst the "anti-overwork" movement, the silicone market underwent a structural transformation in December. Several leading monomer enterprises have confirmed their intention to voluntarily reduce production capacity. This contraction on the supply side has effectively bolstered the confidence of both upstream and downstream segments of the industry chain in maintaining prices, gradually steering the industry from an imbalance between supply and demand towards profit recovery. It is expected that in the first half of 2026, the industry's operating rate will remain around 60-70%, with the production reduction measures affecting approximately 650,000 to 750,000 tons of capacity. The market is poised to enter a tight balance between supply and demand.
Although the market remained cautious before the New Year, driven by the rise in raw materials, enterprises' bullish expectations generally increased after the New Year's Day. Monitoring data showed that the overall price of DMC increased by 500 yuan/ton in December and is currently stable in the range of 13,500-14,000 yuan/ton.
During the New Year's Day holiday, downstream enterprises were mostly in a state of shutdown and vacation, resulting in a subdued trading atmosphere. Inquiries were cautious, and the overall sentiment tended to be conservative. However, monomer factories currently face little inventory pressure. Although pre-sale orders have decreased, post-holiday quotations are expected to remain firm. Actual transactions are expected to gradually shift towards lower price ranges. Today, the latest quotations from the three major factories for DMC are 13,500 yuan/ton, 13,700 yuan/ton, and 14,000 yuan/ton, continuing to support the price.
Currently, most silicone enterprises in various industries are still hovering around the break-even point. As the market landscape gradually improves in 2026, the industry generally anticipates a sustained and moderate increase in prices to alleviate operational pressures, boost production enthusiasm, and usher in a new round of healthy development cycle.
[Market Trend Outlook for 2026] From 2024 to 2025, the core contradiction in the industry will be predominantly manifested as "structural internal competition": in the low-end general product sector, the concentrated release of production capacity has led enterprises to be deeply embroiled in a price war where "increasing production does not lead to increased profits"; whereas in the high-end application sector with high technological barriers, key products still rely on imports, and there are shortcomings in independent supply. At the policy level, the orientation towards "high-quality development" is clear, and a series of measures aimed at optimizing the supply structure have been successively introduced.
The industry itself is also facing a critical turning point in its cycle. After the capital expenditure of leading enterprises peaked in 2023, the pace of expansion slowed down significantly in 2024-2025. More significantly, the total amount of projects under construction in the industry peaked in 2024 and entered a rapid digestion channel in 2025, marking the substantial end of the stage driven by new capacity growth. From 2026 onwards, the development logic of the entire industry is shifting comprehensively from "incremental investment competition" to "stock optimization and new breakthroughs in innovative application value".
Looking at the situation from the beginning of 2026, the silicone industry is entering a new stage driven by both "external forces of emission reduction" and "internal forces of the cycle". On the one hand, the "anti-involution" policy has been continuously deepened since 2024, forcibly reshaping competition rules from the outside and guiding resources to be allocated to high value-added fields. On the other hand, the internal capacity expansion cycle of the industry confirmed its peak in 2025 and began to decline, tightening the "gate" of disorderly supply growth. Policy guidance and the peak of the cycle have resonated, and an "era of intensive cultivation" focusing on technological upgrading, product innovation, and improvement of industrial chain efficiency has begun.