The Chinese new energy vehicle market is currently undergoing a subtle turning point. On one hand, the growth rate of mainstream electric and hybrid models has hit an 18-month low; on the other hand, a group of new carmakers with diverse backgrounds are entering the race track. Local governments are looking to revitalize the economy by exporting excess production capacity overseas. However, analysts believe that the new players lack the ability to sustain growth, and the “survivors” need to return to commercial fundamentals.
According to data released by the China Passenger Car Association (CPCA) on September 8, 2025, electric vehicle (EV) and hybrid electric vehicle (HEV) sales in China grew by 7.5% year-on-year in August, a significant slowdown from July’s 12% growth.
Reuters reported that this is the lowest growth rate since February 2024. During the same period, total car sales reached 2.02 million units, a 4.9% year-on-year increase, the slowest growth rate in seven months.
Leading Chinese electric car manufacturer BYD has lowered its 2025 sales target by 16% to 4.6 million units.
Tesla’s sales in the Chinese market have been declining for four consecutive months, with August marking the first continuous monthly production decline since 2020.
As demand for extended-range models weakened, NIO saw a three-month consecutive sales decline.
Cui Dongshu, Secretary General of the China Passenger Car Association, believes that the recent call by the Chinese government to stop industry speculation and excessive price competition could further slow down automotive sales in the fourth quarter.
Amid a deep restructuring of the Chinese new energy vehicle industry, new carmakers are quietly emerging, including Zuisheng Technology, Shengqi Auto, Yunjie Auto, Gongjiangpai, and Goldfish Auto.
On August 28, robotic vacuum cleaner company Zuisheng Technology announced its entry into car manufacturing, with its first model planning to compete with Bugatti Veyron and scheduled for mass production in 2027. On August 25, Yunjie Intelligent Auto Co., Ltd. was established with plans to operate internet-based battery-swapping cars. In July, Shengqi Auto released a photovoltaic-powered SUV emphasizing “charging while driving”, allowing users within the Tropic of Cancer to enjoy “zero-cost” daily travel up to 50 kilometers. In June, Goldfish Auto launched a two-door electric sports car. In April, Gongjiangpai Auto’s “sports car SC01” was priced starting at 229,800 yuan and debuted in the market.
Ten years ago, the first wave of new car crazes in China saw only NIO, Li Xiang, and others survive to this day. Around 2021, another wave of car making by technology companies dominated, with Xiaomi Auto as a typical representative.
The new entrants in the industry this year are seen as the third wave of new forces. These companies come from various backgrounds, ranging from robotic vacuum cleaner makers to battery makers, real estate developers, and charging providers.
Unlike the first wave of new forces around 2015 and attempting to dominate the domestic market, the current car-making craze sees many companies focusing their strategies overseas.
According to “Economic Observer”, Zuisheng Technology plans to leverage China’s supply chain and a global network of 6,000 channels to target the high-end European market.
Wang Xiaotong, founder of Gongjiangpai, told the “Economic Observer” that 350 units of Gongjiangpai’s SC01 sports car have been pre-ordered by Japanese customers, with 50 units also pre-ordered by Chilean customers.
Other brands are focusing on underdeveloped markets in Asia, Africa, and Latin America, constructing KD factories through cooperation or joint ventures, and exporting “green travel solutions”.
Yuying New Energy has reached cooperation agreements with multiple countries including Pakistan. On August 5, they announced on their official account that a “discussion on overseas cooperation in Armenia” was held at the Mustang factory.
Shengqi Auto announced that on April 8, its C11A model passed all 11 mandatory safety tests in the EU, meaning C11A meets market entry requirements in most regions of Southeast Asia and Africa. Currently, the first step is to launch the localization adaptation testing and production consistency review in the Thai market.
The “Economic Observer” believes that the third wave of new forces signals a “survivor game” in the electric car industry.
Analysts point out that although concepts like high-end features and photovoltaic power draw attention, they lack long-term market validation. If these new players fail to establish themselves in overseas markets, they may repeat past failures.
Moreover, due to the lack of accumulation in technology, brand, supply chain, and market experience among these cross-industry companies, they may not necessarily possess the ability to sustain growth.
This “produce domestically, sell overseas” model is a reluctant move driven by local governments.
Data from the Gaishi Auto Research Institute shows that in 2024, the overall capacity utilization rate of Chinese auto companies was only 49.5%. Nearly 20 million vehicles in China are currently idle, according to reports.
“Economic Observer” points out that with subsidies declining and price wars continuing among carmakers, profit margins have been severely squeezed in the domestic market. While overseas markets are still in the early stages of demand activation, becoming a new area of incremental growth.
Against this backdrop, local governments are providing production bases and tax incentives to these companies through industrial parks, land, and policy subsidies, aiming to relieve domestic overcapacity and price war pressures.
Some analysts believe that this is more like a regional industry’s “self-rescue” rather than purely market competition.
In today’s increasingly competitive global new energy vehicle market, true survivors may still need to return to commercial fundamentals: reliable products, market fit, and sustainable profitability.