Chinese automakers saw a 27% increase in new energy vehicle (NEV) sales in August 2025, totaling 1.395 million units, but growth has slowed. Government incentives and discounts haven’t prevented the slowdown. NEV sales globally surged to 12.9 million units in 2024, with dominant players like BYD and Geely leading the charge.

BYD and Geely have shown significant growth, with BYD overtaking SAIC Motor in sales. Total NEV sales in 2025 increased by 37%, with over 45% of global deliveries coming from China. Battery electric vehicle (BEV) sales surged by 46%, while plug-in hybrid vehicle (PHEV) sales rose by 22%.

Despite heavy incentives and discounts, domestic NEV sales only grew by 31%, indicating market saturation. Passenger NEV sales rose by 7.5%, with BEV sales up 17% but passenger PHEV sales falling. The government provides up to CNY 20,000 in incentives and tax exemptions for NEV buyers.

The government plans to reduce NEV subsidies in 2026, shifting to a sales tax discount. It encourages NEV adoption in public transportation. Overseas expansion is also encouraged, with new assembly plants set up globally. Smaller NEV startups may face challenges due to potential subsidy cuts.

China’s NEV market faces slowing growth, despite incentives. Major players drive the market, but smaller startups may struggle. Global sales have surged, but domestic market growth slows, raising concerns about future prospects and the impact of potential subsidy cuts.

Read more at Yahoo Finance: China’s NEV market begins to slow