China’s Passenger Vehicle Sales Hit 1.995 Million in August, NEV Penetration Tops 50%

In August, retail sales of NEVs reached 1.101 million units, up 7.5% YoY and 11.6% MoM, with a retail penetration rate of 55.2%, an increase of 1.5 percentage points from a year earlier.

China’s passenger vehicle retail sales reached 1.995 million units in August 2025, up 4.6% year-on-year and 8.2% month-on-month, according to the latest data from the China Passenger Car Association (CPCA).

For the January–August period, cumulative retail sales stood at 14.741 million units, an increase of 9.5% from a year earlier.

The August figure set a new monthly record, surpassing the previous peak of 1.92 million units recorded in August 2023, representing a 3.7 percentage point increase.

CPCA Secretary-General Cui Dongshu noted that the trend of “anti-involution” in the auto market is becoming more evident, with the price war showing signs of easing. In August, 23 models saw price cuts, six fewer than in the same period last year.

Promotional intensity for new energy vehicles (NEVs) rose to a medium-to-high level of 10.7% in August, 2.5 percentage points higher year-on-year and up 0.5 percentage points from July. Promotional activity has stabilized in recent months, returning to levels considered normal for the industry.

NEVs continued to drive growth, with retail penetration exceeding 50% for the fifth straight month. In August, NEV retail sales reached 1.101 million units, up 7.5% year-on-year and 11.6% month-on-month, bringing penetration to 55.2%, 1.5 percentage points higher than a year earlier.

Domestic brands remained the backbone of NEV adoption. Their penetration rate reached 76% in August, far above the industry average. In terms of market share, domestic brands accounted for 69.5% of NEV retail sales, down 3.4 percentage points year-on-year.

Emerging EV makers expanded their presence, with their collective share climbing to 20.8%, up 4.7 percentage points from a year earlier. XPeng, Leapmotor, and Xiaomi contributed significantly to this growth. Tesla’s share in China reached 5.2%, a year-on-year increase of 1 percentage point.

Traditional joint-venture brands continued to face pressure. In August, mainstream joint-venture retail sales totaled 470,000 units, down 2% year-on-year. Luxury car retail sales fell 5% to 210,000 units, though they rebounded 21% month-on-month, representing a 10.5% market share.

Within the NEV segment, a sharp divergence is emerging. Extended-range electric vehicles (EREVs), once viewed as the cure for “range anxiety,” faced a downturn this summer.

Wholesale EREV sales fell 9.5% year-on-year and 9.2% month-on-month in August to 99,000 units. Retail sales were flat, edging up just 0.3% year-on-year and down 1.4% from July.

By contrast, battery-electric vehicles (BEVs) maintained robust momentum. Retail sales climbed 17.2% year-on-year to 686,000 units in August, while wholesale volumes surged 38.5% to 815,000 units.

In recent years, Li Auto capitalized on the EREV route to scale rapidly, followed by domestic players such as Geely, Changan, and BYD. Newcomers like Xiaomi, Leapmotor, NIO, and XPeng, as well as foreign automakers including GM and Ford, also included EREVs in their portfolios.

However, by 2025 the segment’s market share slipped to 8.81% from 10.27% a year earlier, underscoring challenges in regaining its previous high-growth trajectory.

“With advances in BEV range, charging efficiency, and the widespread adoption of 800V high-voltage platforms, the once core advantage of EREVs—eliminating range anxiety—is losing ground,” Cui said.

He added that while EREVs will retain a niche presence, growth is unlikely to return to past highs. “In the remaining months of 2025, EREV growth is expected to slow further, with full-year expansion likely limited to single digits.”