Major German carmakers hit by steep China sales plunge as competition heats up

Major German carmakers are facing steep China sales declines, underscoring intensifying competition in the world’s largest auto market. For the April–June quarter, Volkswagen, Mercedes-Benz, BMW and Porsche reported China sales falling between 30% and 41% year over year, according to company data released over the past week. In the first half of 2025, all reported more than a 20% drop in China, and the declines have squeezed profits and, in some cases, offset gains elsewhere. The pressure comes as Chinese rivals expand overseas, including into Europe, while domestic China demand is weakened by a prolonged property sector downturn and economic slowdown. Volkswagen’s deliveries in China fell 36.6% to 424,300 vehicles, dragging its global sales down 8.6%. China passenger car sales fell 24% to nearly 8.3 million in the first half, while AlixPartners expects about a 10% decline in full-year light vehicle sales.