The first half of 2025 has proven to be a landmark period for China’s automotive industry, with production and sales surging to new heights, led by the extraordinary momentum of electric vehicles. As policy-driven consumption boosts and technological advancements converge, the sector has not only defied global headwinds but also solidified its position as a global leader in automotive innovation and manufacturing.
In the bustling offices of the China Association of Automobile Manufacturers (CAAM) in Beijing, the release of H1 data on July 10 sent ripples of optimism through the industry. The numbers tell a compelling story: from January to June, domestic automobile production and sales both exceeded 15 million units, marking a year-on-year growth of over 10%. This robust performance is a testament to the resilience of China’s auto market, which has bounced back strongly on the back of targeted policy support and shifting consumer preferences.
At the heart of this growth story is the electric vehicle (EV) segment, which has emerged as the undeniable engine of progress. EV production reached 6.968 million units in H1, with sales hitting 6.937 million units—year-on-year increases of 41.4% and 40.3% respectively. These figures are not just numbers; they represent a seismic shift in the automotive landscape, as EVs now account for 44.3% of total new car sales in the country. This means that nearly half of all new cars hitting China’s roads in the first six months of 2025 are electric, a milestone that few industry watchers could have predicted just a decade ago.
The surge in EV adoption is no accident. It is the result of a confluence of factors, chief among them the effective implementation of policies aimed at stimulating consumption, such as the “old-for-new” vehicle replacement program. This initiative, which encourages consumers to trade in their old vehicles for new ones, has been a game-changer. By reducing the financial barrier to upgrading, it has not only spurred demand for new cars but also accelerated the transition to cleaner, more sustainable mobility options—with electric vehicles being the primary beneficiaries.
Industry experts point to the “old-for-new” policy as a critical catalyst. “The implementation and effectiveness of consumption-promoting policies like the old-for-new program have been instrumental in driving the market’s positive trajectory,” notes Chen Shihua, Deputy Secretary-General of CAAM. These policies have not only boosted immediate sales but also fostered a culture of upgrading to more efficient and environmentally friendly vehicles, with electric vehicles at the forefront.
June, in particular, stood out as a standout month. Automobile sales reached 2.312 million units, up 8.3% month-on-month and 11.9% year-on-year. Breaking down the numbers, traditional fuel-powered vehicle sales hit 1.188 million units, a 14.2% month-on-month increase and 7.7% year-on-year rise. However, it was electric vehicles that stole the spotlight: in June alone, EV production and sales reached 1.268 million and 1.329 million units respectively, soaring by 26.4% and 26.7% compared to the same period last year. Notably, EVs accounted for 45.8% of total new car sales in June, inching closer to the 50% mark and underscoring their growing dominance in the market.
The first-half performance of electric vehicles is even more impressive when viewed in context. With 6.968 million units produced and 6.937 million units sold, EVs have not only maintained their upward trajectory but accelerated it, with year-on-year growth rates of 41.4% and 40.3% respectively. This growth is not just about volume; it reflects a fundamental shift in consumer behavior. More and more Chinese buyers are choosing electric vehicles not just for their environmental benefits but also for their technological sophistication, lower running costs, and improved performance. From compact city cars to high-end luxury models, the EV market now offers a diverse range of options, catering to every segment of the population.
The increasing penetration of electric vehicles is reshaping the entire automotive ecosystem. Automakers, both domestic and international, are ramping up investments in EV production lines, battery technology, and charging infrastructure. Chinese brands, in particular, have made significant strides in innovation, with breakthroughs in battery energy density, fast-charging technology, and autonomous driving features. This focus on R&D has not only enhanced the competitiveness of Chinese EVs in the domestic market but also positioned them as strong contenders on the global stage.
Exports have emerged as another key growth driver for China’s automotive industry, with electric vehicles leading the charge. In the first half of 2025, total automobile exports reached 3.083 million units, a year-on-year increase of 10.4%. Within this, EV exports surged to 1.06 million units, marking an astonishing 75.2% year-on-year growth. This exponential rise in EV exports is a clear indication of the global demand for Chinese-made electric vehicles, which are increasingly recognized for their quality, affordability, and advanced technology.
June was a particularly strong month for exports, with 592,000 units shipped overseas, a 7.4% month-on-month increase and a 22.2% year-on-year jump. Analysts attribute this growth to several factors, including the expansion of overseas distribution networks by Chinese automakers, favorable trade agreements with key markets, and the growing global emphasis on reducing carbon emissions, which has heightened demand for electric vehicles.
Chen Shihua, commenting on the export performance, highlighted the strategic importance of overseas markets for Chinese automakers. “The rapid growth in EV exports is a result of years of investment in global branding and localization,” he explained. “Chinese automakers are no longer just selling cars; they are building ecosystems, partnering with local companies to establish charging networks and after-sales services, which is crucial for long-term success in foreign markets.”
The success of domestic brands has been a defining feature of H1 2025. According to Cui Dongshu, Secretary-General of the China Passenger Car Association (CPCA), self-owned brands have excelled in several key areas: technological innovation, overseas market expansion, and breakthroughs in the high-end segment. “Chinese brands are no longer playing catch-up; they are setting the pace,” Cui noted. “In electric vehicles, they have achieved parity, if not superiority, with international brands in terms of technology and design, and this is reflected in their market share and export numbers.”
One of the most notable trends is the rise of high-end electric vehicles from domestic brands. Models priced above 300,000 yuan (approximately $42,000) have seen strong demand, challenging the dominance of foreign luxury automakers. These vehicles combine cutting-edge technology—such as advanced driver-assistance systems (ADAS), intelligent infotainment, and long-range batteries—with sleek designs, appealing to a new generation of affluent consumers who value innovation and sustainability.
The policy landscape has played a pivotal role in supporting the growth of the automotive industry, particularly electric vehicles. The “two new” policies—referring to new energy vehicles and new infrastructure—have been instrumental in creating a conducive environment for growth. These policies include subsidies for EV purchases, tax incentives, investments in charging infrastructure, and support for R&D in battery technology. As these policies continue to be implemented, they are expected to further unlock domestic demand and drive market expansion in the second half of the year.
Chen Shihua emphasized the importance of policy stability in sustaining growth. “The continued implementation of the ‘two new’ policies will be crucial for maintaining momentum,” he said. “Consistent policy support helps build consumer confidence and encourages automakers to invest in long-term projects, which is essential for the industry’s transformation.”
However, despite the positive outlook, the industry faces significant challenges. Chen Shihua warned of increasing complexity, severity, and uncertainty in the external environment, coupled with intense domestic competition and pressure on profit margins. “While growth is strong, we must not overlook the headwinds,” he cautioned. “Global economic uncertainties, trade tensions, and supply chain disruptions remain potential risks. Additionally, the race to innovate has led to intense competition, with automakers under pressure to cut prices, which affects profitability.”
The issue of profitability is particularly acute in the electric vehicle segment, where intense competition has led to price wars in some markets. While this benefits consumers in the short term, it raises concerns about the long-term viability of some players, especially smaller automakers. Chen called for measures to stabilize policy expectations, regulate market competition, and strengthen industry self-discipline to ensure healthy and sustainable growth.
Cui Dongshu echoed these concerns but struck a more optimistic note about the second half of the year. “We expect market prices to stabilize in H2, which will help improve profit margins,” he said. “Coupled with the further release of domestic demand driven by the ‘two new’ policies, the automotive market is poised for steady growth.” He also highlighted the role of self-owned brands in driving this growth, noting their strong performance in innovation and overseas expansion.
Looking ahead, the second half of 2025 is expected to see continued growth, albeit at a potentially more moderate pace. The release of new models by automakers, particularly in the electric vehicle segment, is likely to keep consumer interest high. Major manufacturers have already announced plans to launch dozens of new EV models in the coming months, ranging from affordable compact cars to high-performance luxury vehicles. These new models are expected to feature advancements in battery technology, longer ranges, faster charging, and more sophisticated autonomous driving capabilities, further enticing consumers to make the switch to electric.
The expansion of charging infrastructure will also be a key factor in driving EV adoption. The government has announced plans to accelerate the construction of public charging stations, particularly in rural areas and along major highways, to address range anxiety—a common concern among potential EV buyers. Private companies are also investing heavily in charging networks, with some partnering with retail chains, gas stations, and residential complexes to make charging more convenient.
In terms of exports, Chinese automakers are set to expand their footprint in key markets such as Europe, Southeast Asia, and Latin America. Several major brands have announced plans to build production facilities overseas, which will not only reduce shipping costs but also help them navigate trade barriers and meet local content requirements. This localization strategy is expected to further boost EV exports in the coming years.
The role of electric vehicles in China’s broader energy transition cannot be overstated. As the country moves towards its carbon neutrality goals, the widespread adoption of EVs is critical for reducing emissions from the transportation sector, which accounts for a significant portion of China’s total carbon output. The growth of the EV market is also driving demand for renewable energy, as more consumers and businesses seek to power their vehicles with clean electricity, creating a virtuous cycle of sustainability.
In conclusion, the first half of 2025 has been a period of remarkable growth for China’s automotive industry, with electric vehicles at the forefront of this expansion. The sector’s strong performance is a result of a combination of policy support, technological innovation, shifting consumer preferences, and successful overseas expansion. While challenges remain, the future looks bright, with the “two new” policies expected to drive further growth in the second half of the year. As electric vehicles continue to gain market share and Chinese automakers strengthen their global presence, the industry is well-positioned to lead the global automotive revolution in the years to come.
The story of China’s automotive industry in H1 2025 is not just about numbers; it is about a transformative shift towards a more sustainable, innovative, and globally competitive future—one where electric vehicles are not just a trend, but the new norm. As the world watches, China’s automotive sector is proving that with the right policies, investment, and vision, it can overcome challenges and emerge as a global leader in the era of electric mobility.
This momentum is expected to continue, with electric vehicles playing an even more central role in the industry’s growth trajectory. As battery technology improves, charging infrastructure expands, and consumer acceptance deepens, the potential for further growth is enormous. For automakers, both domestic and international, adapting to this shift is no longer an option but a necessity. For consumers, the choice is increasingly clear: electric vehicles are not just the future of transportation—they are the present.
In the months ahead, all eyes will be on the Chinese automotive market as it navigates the challenges and opportunities of the second half of 2025. With the foundation laid in the first six months, and the continued support of policies and innovation, there is every reason to believe that the industry will continue to thrive, with electric vehicles leading the way towards a more sustainable and prosperous future.
The growth of electric vehicles in China is not just a national phenomenon; it is a global one. As China produces more electric vehicles, exports more electric vehicles, and innovates more in electric vehicle technology, it is shaping the future of transportation worldwide. Other countries are looking to China’s example, adopting similar policies to promote electric vehicles and investing in their own EV industries. This global shift, driven in large part by China’s success, is accelerating the transition to a low-carbon future, benefiting the planet and people everywhere.
In the end, the story of China’s automotive industry in H1 2025 is a story of progress—progress in technology, progress in sustainability, and progress in global leadership. And at the center of this progress is one thing: the electric vehicle. As the industry moves forward, there is no doubt that electric vehicles will remain the key driver of growth, innovation, and change, making China’s automotive success in the first half of 2025 a milestone in the journey towards a more electric future.
The numbers, the policies, the innovations—all of these are pieces of a larger puzzle, and when put together, they form a clear picture: China’s automotive industry is in the midst of a historic transformation, and electric vehicles are the catalyst. This transformation is not just about selling more cars; it’s about reimagining transportation, redefining mobility, and leading the world into a new era of automotive excellence.
As we reflect on the first half of 2025, it’s clear that the best is yet to come for China’s automotive industry. With electric vehicles at the helm, the future is bright, and the possibilities are endless. The growth, the innovation, the global impact—all of these are testaments to the hard work, vision, and resilience of the industry, and they serve as a promise of even greater things to come in the months and years ahead.
Electric vehicles have become more than just a segment of the automotive market in China; they are a symbol of the country’s ability to innovate, adapt, and lead. In the first half of 2025, they have proven their worth, driving growth, creating jobs, reducing emissions, and putting China at the forefront of the global electric vehicle revolution. As we look to the future, there is no doubt that electric vehicles will continue to be the driving force behind China’s automotive success, ensuring that the country remains a global leader in the industry for years to come.
The first half of 2025 will be remembered as a turning point for China’s automotive industry—a time when electric vehicles moved from being a niche product to the mainstream, when domestic brands rose to global prominence, and when the industry solidified its position as a global powerhouse. It is a story of ambition, innovation, and success, and it is far from over. The second half of the year holds even more promise, with new models, new technologies, and new markets waiting to be explored, all with electric vehicles at the center.
In conclusion, the first half of 2025 has been a remarkable period for China’s automotive industry, and electric vehicles have been the star of the show. Their growth, their innovation, their impact—all of these have made this period one for the history books. As we move forward, there is every reason to be optimistic, for the future of China’s automotive industry is electric, and it is bright.
The journey of China’s automotive industry in H1 2025 is a testament to what can be achieved with vision, policy support, and a commitment to innovation. It is a journey that has been driven by the electric vehicle, and it is a journey that will continue to shape the industry, the country, and the world for many years to come.
As the world transitions to electric mobility, China’s role as a leader is secure, thanks in large part to the extraordinary growth and innovation of its electric vehicle sector in the first half of 2025. This growth is not an accident; it is the result of careful planning, strategic investment, and a willingness to embrace change. And as long as these factors remain in place, there is no limit to what China’s automotive industry can achieve, with electric vehicles leading the way.
The story of electric vehicles in China in H1 2025 is one of success, but it is also one of potential—potential for even greater growth, potential for even more innovation, and potential to lead the world in the transition to sustainable transportation. This potential is real, and it is being realized every day, as more electric vehicles roll off production lines, more electric vehicles hit the roads, and more electric vehicles are exported to countries around the globe.
In the end, the first half of 2025 will be remembered as a pivotal moment in China’s automotive history—a moment when the electric vehicle became not just a part of the industry, but the heart of it. And as we look to the future, that heart is beating stronger than ever, driving the industry forward into a new era of prosperity, sustainability, and global leadership.
This is the story of China’s automotive industry in H1 2025: a story of growth, driven by electric vehicles; a story of innovation, led by electric vehicles; and a story of global leadership, defined by electric vehicles. It is a story that is still being written, and the next chapter promises to be even more exciting.
As the second half of 2025 unfolds, the world will continue to watch China’s automotive industry, and one thing is certain: electric vehicles will remain at the center of attention, driving progress, shaping markets, and leading the way towards a more electric future for all.