International luxury car brands such as Mercedes-Benz and Land Rover experienced a significant decline in sales in China last month, with luxury auto brands reporting 162,224 vehicle sales—a 29.5% decrease compared to the same period in 2025, according to data from the China Passenger Car Association (CPCA).

The luxury segment, traditionally dominated by international marques, is facing increasing competition from China's rising electric vehicle (EV) manufacturers. The luxury category includes only two domestic EV brands: BYD’s Yangwang and JAC Group’s Maextro. Meanwhile, most of the more than ten other luxury marques, including BMW, Jaguar, and Infiniti, continue to offer only petrol-powered cars in the mainland market.

Zhao Zhen, sales director at Shanghai dealer Wan Zhuo Auto, noted, “The luxury segment was believed to be international brands’ stronghold, as more low-priced electric cars developed by Chinese companies showed an upper hand in the mass market. The downward trend is set to continue amid consumers’ waning demand for premium cars and increasing penchant for EVs due to rising crude oil prices.”

CPCA data also showed that luxury car deliveries during the first half of the year fell 17.9% year on year to 967,929 units. Analysts suggest that international carmakers will find it increasingly difficult to maintain their market share and profitability in the world’s largest automotive market as domestic EV powerhouses continue to grow.

Sources