China’s car sales momentum is expected to ease in July following a robust first half, the China Passenger Car Association (CPCA) said on Friday.
Retail sales of passenger vehicles are projected to reach approximately 1.85 million units this month, a 7.6% increase from a year earlier but down 11.2% from June.
New energy vehicle (NEV) sales are expected to total around 1.01 million units, resulting in a record penetration rate of 54.6%.
The CPCA said sales in early July were affected by demand brought forward to June, as manufacturers pushed aggressively to meet mid-year sales targets.
This front-loading led to a seasonal pullback in early July, with daily average retail sales falling to 39,700 units in the first week, a 1.2% year-on-year gain but a 5.8% month-on-month decline.
The CPCA forecasts fourth-week daily sales of 68,100 units, up 7.6% year-on-year but down 28.8% month-on-month.
The association noted that promotional activity remained steady in early July, with average discounts hovering around 25%.
The July outlook comes after a strong June, when car sales rose for a fifth consecutive month, climbing 18.6% year-on-year to 2.1 million units, accelerating from a 13.9% gain in May.
For the first half of 2025, passenger vehicle sales increased 11.2% to 11.1 million units.
In Europe, and despite a slight decline in the overall automotive market, Chinese automakers achieved a record share of 5.7% in European vehicle registrations last month.
According to data from Jato Dynamics, Chinese vehicle sales jumped 63% year over year in June to 70,832 units.
Last month, the Tesla Model Y and Model 3 were the best-selling BEVs in Europe. However, registrations of the Model 3 sedan dropped by 33% compared to the same month last year, totaling 10,849 units.
