BEIJING — China’s electric car boom is set to end modestly in 2025, with sales falling and analysts warning that a fierce price war is likely to continue.

Not only did it Tesla Check its sales down 7.4% Sales of market leader BYD also fell 5.1% year-on-year, according to data from the China Passenger Car Association from January to November.

BYDPassenger car sales in November alone fell 26.5% from the same period last year, and new competitors, including vehicles using Huawei software and models from Huawei Milletsales increased by more than 90% during the same period.

Three giants of Chinese electric vehicle start-ups that were early listed in the United States—— Nioh, Xpeng Motors and rickshaw — Although monthly deliveries improved, it failed to crack the top 10 sales volume for the month.

Market concentration has increased significantly. Xiao Feng, co-head of China industry research at CLSA, said the top ten manufacturers currently account for about 95% of China’s new energy vehicle market, a sharp increase from about 60% two or three years ago to 70%. New energy vehicles include pure electric vehicles and hybrid vehicles.

“I think there will be further consolidation in the industry, although price is more important than specific brands,” he said. “Clearly buyers aren’t going to buy a car they’ve never heard of.”

The scale of price cuts highlights the pressure. Autohome, an online platform for Chinese car sales data, even lists vehicles by discount percentage, such as the Mercedes-Benz EQS EV with a price cut of 432,000 yuan ($61,660) and the Volvo XC70 with a price cut of 147,000 yuan.

Paul Gong, head of China automotive research at UBS, expects the price war to last “several years” while domestic policy changes could affect growth next year.

Beijing will re-Collection tax At the same time, trade-in purchase subsidies will be reduced, he said. UBS expects the growth rate of electric vehicle sales in China to halve next year from about 20% in 2025.

The market is saturated, and new energy vehicles account for 59.4% The number of new passenger cars sold in China in November, according to the China Passenger Car Association.

In the first half of this year, Hangzhou-based Geely Automobile said, Electric vehicle exports quadruplebringing total vehicle exports to 184,000 units. During this time, the company entered Australia, Vietnam and four other markets, expanding its reach to approximately 90 countries. The automaker has also opened factories in Egypt, the Middle East and Indonesia.

Geely ranks second behind BYD in China’s new energy vehicle sales.

BYD is also expanding overseas production, including New factory in Hungary Production expansion is planned for 2026. the company Exported over 131,000 vehicles Only in November.

Tu Le, founder and managing director of consulting firm Sino Auto Insights, expects more Chinese automakers and battery companies to “firmly establish themselves in Europe,” bringing competition closer to the United States and Tesla.

german auto giant Volkswagen Established local joint ventures with Xpeng Motors and China Automotive Chip Design Company horizon robot. Volkswagen’s largest R&D center outside Germany is in Hefei, China, and the automaker said last month it would now be able to build it there Complete every step of the vehicle development and approval process Local first.

This capability could help Volkswagen launch cars in China faster, with several new models planned for 2026.

In the first three quarters of 2025, Volkswagen will deliver More than 17 million China’s car sales increased by 8.5% year-on-year, far exceeding Western Europe’s 8.9 million vehicles.

China’s market size remains profitable for foreign companies. “It’s not a failure for U.S. automakers,” said Sino Auto Insights’ Le.

He noted that General Motors still deliver almost China produces 2 million cars a year and, like Ford, also exports cars from China. If automakers can design cars that can compete in China, they can shift manufacturing capabilities domestically, he said, noting “that’s where GM is closer than Ford.”

Le warned that it might be too early for any automaker, domestic or foreign, to declare victory in the world’s largest auto market.

“But in China you might be on top one month and by the next quarter you’re catching up and wondering what happened.”