China’s LV market showed remarkable resilience in July 2025, a period typically characterized by sluggish auto sales. During the month, volumes reached approximately 2.0 million units, representing an 11% YoY increase.
Growth was primarily driven by robust demand for PVs, which rose by 10% YoY to 1.8 million units and accounted for 90% of total LV sales. At the same time, LCV volumes saw a moderate gain of 15% YoY, amounting to 186k units. On a YTD basis, sales from January to July increased by 11% compared to the same period in 2024, bolstered by the national subsidy program that encourages consumers to replace older vehicles. Although the seasonally adjusted annualized selling rate (SAAR) for July was 29.8 million units, indicating a 2% decrease from June’s figure, it continues to remain at a historically high level for this period.
As the automotive market entered its traditional off-season in July, production and sales experienced a seasonal MoM decline. Nonetheless, YoY growth continued to be strong, supported by factors such as the trade-in policy and the significant strides made in resolving the industry’s internal challenges. With the phased introduction of government subsidies and the stabilization of automakers’ pricing strategies, consumer hesitation is anticipated to fade, setting the stage for the robust “Golden September, Silver October” sales period.
The “anti-involution” movement in China’s automotive market has recently gained significant attention. This movement is steering the Chinese market away from a uniform parameter arms race and cutthroat price competition, toward a more dynamic landscape that prioritizes distinctive innovation and value. Companies are shifting their focus from simply accumulating features and chasing market share to developing core competencies that meet genuine user demands. They are enhancing software services and brand value, while aiming for profitable growth and sustainable long-term strategies.
This shift encourages automakers to refine their management practices and remove unproductive internal conflicts, creating a demand for genuinely innovative talent. It also fosters a more rational market environment for consumers, highlighting the intrinsic value and user experience of products. Ultimately, this movement against “involution” acts as a catalyst for industry maturity, accelerating the exit of companies that lack core competitiveness and driving the evolution of the Chinese auto industry from mere scale to robust strength.
In July 2025, China’s LV production reached 2.5 million units, marking an 11.3% YoY increase, despite representing a 7.1% MoM decrease. PVs, which accounted for 90% of the total output, expanded by 11.1% YoY to 2.3 million units, underscoring sustained consumer demand and market resilience. Additionally, CV production witnessed moderate growth, with a 13.6% YoY rise to 229k units.
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By GlobalDataAmid ongoing efforts to curb excessive competition within the industry, Chinese automakers are actively working to maintain stable prices in the market, which has helped to stabilize production rhythms.
At the same time, the national vehicle trade-in policy has provided substantial support for domestic production, boosting the output of compliant and replacement-oriented models. In addition, continued growth in exports—particularly to emerging markets in Southeast Asia and Latin America—has further increased production volumes, offsetting fluctuations in certain regional markets and contributing to a steady expansion of manufacturing plans.
In July 2025, China’s LV exports reached 544k units, marking a 20.8% YoY increase, despite representing a 2.3% MoM decrease. PVs remained the primary contributor, with exports climbing by 23.1% YoY to 499k units. Meanwhile, CV exports saw a marginal decline of 0.1% YoY, totaling 45k units. From January to July 2025 overall, shipments reached 3.4 million units, representing a robust 10.5% growth compared to the same period in the previous year.
China’s strong export performance, especially in PVs, stems from its competitive EV products and strategic penetration into emerging markets. The country’s well-established supply chain provides a substantial advantage in terms of cost and efficiency, facilitating steady production to meet domestic and global demand. Nevertheless, the modest decrease in CV exports highlights challenges that are unique to this segment, including fluctuating demand and potential trade barriers. These issues warrant ongoing scrutiny, even in the light of the overall positive export trend.
This article was first published on GlobalData’s dedicated research platform, the Automotive Intelligence Center.
