The industry’s 14 major participants reported a 10 per cent sales slump in the first half of 2025, following an 18 per cent year-on-year decline in 2024, according to data from the China Passenger Car Association (CPCA).
Cui Dongshu, general secretary of the government-backed industry consortium, said most of the dealers were unable to generate positive cash flow as they ran at huge losses.
“Relevant authorities are suggested to urge banks to provide financial support to players in the car distribution industry,” he said. “Financial-services firms can play a role in stabilising the automobile market by collaborating with the dealers.”
The CPCA’s findings echoed a bearish forecast by the China Automobile Dealers Association (CADA) at the end of last year. The Beijing-based association said in a report that many of its members would turn from profit generators into corporate failures in two years.
China is home to about 30,000 car dealers, which also engage in after-sales service, supply of spare parts and brokering of auto insurance sales.
