New energy penetration breaks the deadlock, bringing new opportunities to domestic brands
At the dawn of the second half of 2025, the Chinese auto market is experiencing new changes. According to the latest data, in July of this year, the domestic passenger car market saw a total of 1.85 million new vehicles insured, a slight year-on-year increase of 1.7%. Domestic brands performed strongly, with an 11% year-on-year increase, while overseas brands saw an 11.5% year-on-year decline. This contrasting situation reflects the strong momentum of domestic brands in the market.
More importantly, the penetration rate of new energy vehicles has finally broken a year-long stalemate. In August of last year, the domestic new energy penetration rate exceeded 50% for the first time, soaring to 51.05% that month. Eleven months later, the penetration rate broke through again in July of this year, reaching 52.87%, a 1.1 percentage point increase from June. This data not only demonstrates consumer acceptance of new energy vehicles, but also indicates that market demand for them is continuously increasing.
Specifically, each powertrain type performed differently. In July, new energy vehicle sales grew by 10.82% year-on-year, with pure electric vehicles, the largest category, experiencing a 25.1% year-on-year increase. Meanwhile, plug-in hybrid and range-extended vehicles saw declines of 4.3% and 12.8%, respectively. This shift suggests that despite the overall positive market outlook, different types of new energy vehicles are performing differently.
The market share of domestic brands reached a new high of 64.1% in July, exceeding 64% for the first time. This figure reflects the continuous efforts of domestic brands in technological innovation, product quality, and marketing. With the increasing penetration of new energy vehicles, domestic brands are expected to further expand their market share, even approaching two-thirds of the market share.
Xpeng Motors sees profitability, while NIO’s price cuts draw attention
Amidst increasingly fierce competition in the new energy vehicle market, Xpeng Motors’ performance has been remarkable. Following Leapmotor’s profitable first-half financial report, Xpeng Motors is also on track to achieve profitability. In the first half of this year, Xpeng Motors’ total revenue reached 34.09 billion yuan, a year-on-year increase of 132.5%. Despite a net loss of 1.14 billion yuan in the first half of the year, this was significantly narrower than the 2.65 billion yuan loss in the same period last year.
Xpeng Motors’ second-quarter figures were even more impressive, with record-breaking revenue, profit, deliveries, gross profit margin, and cash reserves. Losses narrowed to 480 million yuan, and gross profit margin reached 17.3%. He Xiaopeng revealed at the earnings conference that starting with the Xpeng G7 and the all-new Xpeng P7 Ultra models, which will launch in the third quarter of this year, all Ultra versions will be equipped with three Turing AI chips, boasting a computing power of 2250TOPS, marking a further breakthrough for Xpeng in intelligent driving.
At the same time, NIO is also adjusting its strategy. It announced a price reduction of its 100kWh long-range battery pack from 128,000 yuan to 108,000 yuan, while the battery rental service fee remains unchanged. This price adjustment has garnered widespread market attention, particularly given that NIO CEO Li Bin has stated that “the first principle is not to reduce prices.” Whether this price reduction will affect the brand image and consumer confidence has become a hot topic in the industry.
New models launched and market competition intensified
As market competition intensifies, new models are constantly emerging. Zhijie Auto officially announced that the new R7 and S7 will officially launch on August 25th. Pre-sale prices for these two models range from 268,000 to 338,000 yuan and 258,000 to 318,000 yuan, respectively. These upgrades primarily feature exterior and interior details, driver assistance systems, and features. The new R7 will also feature zero-gravity seats for both the driver and front passenger, enhancing ride comfort.
In addition, Haval is also actively expanding its market presence. The new Haval Hi4 has officially launched, further enriching consumer choices. As major automakers continue to launch new models, market competition will become increasingly fierce, and consumers will enjoy more choices and more cost-effective products.
Amidst this series of changes, the future of the new energy vehicle market is filled with both uncertainty and opportunity. With the continuous advancement of technology and evolving consumer demands, the new energy vehicle market landscape will continue to evolve. Competition among major automakers in areas such as technological innovation, product quality, and marketing will directly impact their future market position.
Overall, the breakthrough in new energy vehicle penetration, the rise of domestic brands, the market dynamics of Xpeng and NIO, and the launch of new models all signal significant growth in China’s new energy vehicle market. These changes not only reflect the market’s vitality but also foreshadow intensifying competition ahead. As consumer acceptance of new energy vehicles continues to grow, the future automotive market is poised for even more diversified development.
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Post time: Aug-25-2025