China’s electric vehicle (EV) and hybrid car sales rose at their slowest pace in one and a half years in August 2025, even as new energy vehicles (NEVs) continued to outpace gasoline-powered cars for the sixth consecutive month.
According to the China Passenger Car Association (CPCA), sales of EVs and hybrids grew 7.5 percent year-on-year, a sharp slowdown from 12 percent in July. This marked the weakest growth since February 2024, when the segment declined 11.6 percent due to the shifting Chinese New Year holiday period, Reuters news report said.
NEVs Hit Record Market Share in August
Despite slowing growth, August set a new milestone for China’s car market. NEVs achieved their highest-ever monthly sales share, surpassing traditional fuel cars. More new energy vehicles were sold than gasoline-powered vehicles for the month, underlining the structural shift in consumer preference and government policy support.
Overall passenger vehicle sales in China reached 2.02 million units in August, up 4.9 percent from a year earlier. However, this represented the slowest growth in seven months, signaling weaker momentum in the world’s largest auto market.
Price Wars and Government Intervention
Analysts point to Beijing’s push to curb punishing price wars among automakers as a key reason for the slowdown. Authorities have urged manufacturers to avoid “excessive competition” in order to stabilize the market and protect long-term industry health.
Cui Dongshu, secretary-general at the CPCA, said growth will likely remain subdued in the fourth quarter as the government seeks to “resolve issues facing the industry.”
Mixed Fortunes for Major EV Makers
BYD, China’s leading EV manufacturer and Tesla’s top rival, recently slashed its 2025 sales target by up to 16 percent, lowering expectations to 4.6 million units. Domestic sales, which make up nearly 80 percent of BYD’s global total, fell for a fourth consecutive month in August. The company also reported its first back-to-back monthly production decline since 2020.
Li Auto continues to face headwinds in its extended-range hybrid segment, with sales declining for the third straight month. Extended-range hybrids managed only a 0.3 percent year-on-year rise in August after an 11.4 percent drop in July. Plug-in hybrid sales fell 7.3 percent, widening from a 0.2 percent dip in the prior month.
In contrast, Geely, Xpeng, and Nio reported their best-ever monthly EV and hybrid sales in August. Geely, BYD’s biggest domestic rival, recorded a 95.2 percent annual jump in new energy vehicle sales.
Car Exports Also Slow
China’s car exports — dominated by NEVs — rose 20.2 percent year-on-year in August, down from 25 percent growth in July. The slowdown reflects global economic pressures as well as increased scrutiny of Chinese EV exports in Europe and North America.
Outlook for China’s EV Market
While China’s EV and hybrid sector continues to expand, growth momentum is expected to moderate in the coming months. Industry experts say the government’s crackdown on aggressive discounting will help prevent market distortions, but may temporarily weigh on sales figures.
GreentechLead.com News Desk