China car sales jump in June but EV price war concerns intensify

China's car sales rose in June for the fifth straight month, but reports by some major electric vehicle makers of easing demand raised concerns about intensifying competition in the world’s largest auto market.

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Sales grew 18.6 per cent in June year-on-year to 2.1 million vehicles from a 13.9 per cent rise in May.

First-half sales were up 11.2 per cent to 11.1 million vehicles, data from the China Passenger Car Association showed on Tuesday.

EV and plugin hybrids sales, making up 52.7 percent of total car sales, increased a hefty 29.7 per cent in June from a year earlier, up from 28.2 per cent in May.

But local EV giant BYD saw car sales growth slow to 11 per cent from 14.1 per cent in May. Li Auto, which along with BYD are the only two listed Chinese EV makers with full-year profitability, logged a 24.1 per cent sales decline last month, reversing a 16.7 per cent rise in May.

Geely Auto raised its 2025 sales target by 11 per cent to 3 million units, but its sales growth eased to 42 per cent from 46 per cent in May.

The cooling or falling sales pointed to “a big dilemma” facing the industry, as any escalation into “a life-or-death competition could put some at risk of being eliminated,” said Cui Dongshu, secretary-general of CPCA.

Warning the industry of excessive competition, Chinese regulators have called on automakers to halt a growing price war, which is heightening worries about overcapacity amid weak domestic demand and US tariffs.