Chinese passenger car market falters after end of subsidies

Manufacturer Chinese Passenger Car Market Falters After End of Subsidies

2025-11-12 Source: dpa 1 min Reading Time

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Following the end of subsidies, the Chinese car market shrank slightly in October—with one exception for the first time since August 2024.

In October 2025, fewer cars were sold on the Chinese market compared to the previous year.(Image: BYD) — In October 2025, fewer cars were sold on the Chinese market compared to the previous year.
(Image: BYD)

Vehicle deliveries to end customers in China have fallen by 0.8 percent year-on-year. This was announced by the industry association "China Passenger Car Association" in Beijing. Apart from a drop in January due to the Chinese New Year, when sales regularly fall significantly, it was the first decline in the market since August 2024.

In many provinces and large cities in the country, such as Shanghai, trade-in incentives for used cars are expiring or have already been canceled. These had driven new car sales this year—according to government figures, more than ten million such applications for incentives have been received this year. After ten months, sales on the Chinese market are still up 8.3 percent, thanks in part to the incentives.

Difficulties for German Manufacturers

German manufacturers are currently struggling in their former growth market of China. Volkswagen is struggling with the discount battle between local electric car suppliers. Sales figures for Mercedes-Benz, BMW and Porsche are slipping significantly because the wealthy Chinese are buying fewer German brands than before.

In addition, money is no longer so loose among buyers, partly due to the real estate crisis in the country. China is the world's largest car market and also the most important single market for German companies.

Volkswagen China CEO Ralf Brandstätter: "Our measure of success is profitability, not just market share." (Image:Volkswagen AG)

The safety of electric cars is currently the subject of much debate in China. (Image:Image: AI-generated)

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