In August, passenger vehicle sales in China fell for the fifth consecutive month, decreasing by 1.1% YoY to 1.92 million units, though this was an improvement from the 3.1% decline in July. Sales of new energy vehicles (NEVs) surged by 43.2%, representing a record 53.5% of total sales, driven by subsidies for trading in more polluting vehicles. While car exports increased by 24%, consumer confidence remained low, with first-time purchases lagging. Local EV manufacturers, such as BYD and Tesla, saw strong performances, while Nio and Xpeng introduced lower-priced models to address declining consumer spending. Despite these trends, over 80% of trade-in subsidy applicants chose NEVs, reflecting shifting market preferences. Additionally, more than half of car dealerships experienced losses in the first half of the year, with notable failures like China Grand Automotive Services being delisted from the Shanghai stock exchange.