China Auto Sales Growth Slows as Price War Cools, EV Discounts Scale Back

China's auto sales growth slowed in July as government efforts to curb a brutal price war led to fewer discounts and promotions, which dampened consumer demand. Passenger car sales rose just 6.3% year-over-year, down from 18% in June, while electric vehicle sales continued to grow robustly by 12%. The Chinese government's intervention aims to stabilize the industry and prevent unsustainable competition that pressures manufacturers, some of whom have resorted to questionable sales practices to meet targets. Despite reduced discounts, overcapacity and weak demand for expensive vehicles remain key challenges, and a lasting end to the price war is not yet in sight. Industry leaders and government officials acknowledge the difficulties, with some warning that the intense competition threatens the viability of some companies. Export growth offers some relief, but producers face barriers expanding into new markets, underscoring the complex environment for China's automotive sector.