New energy vehicles reached 65.1% of China's new passenger car sales in July, increasing from 54% in the previous year. Meanwhile, Samsung SDI bought out GM's stake in their Indiana battery joint venture to pivot the facility toward energy storage systems due to sluggish EV demand. Additionally, CATL completed safety testing for its aviation batteries, enabling mass production for Autoflight flying vehicles.
EVs dominate China's car market according to latest sales data
According to cnbc.com, electric-powered vehicles continue to tighten their grip on China's fiercely competitive car market, capturing 65.1% of new passenger car sales in July. Autohome industry data shows Geely's Xingyuan electric hatchback led the market as the bestseller with nearly 197,500 units sold in the six months through July at a price just under 100,000 yuan, or $14,820. Tesla secured the second spot with over 180,000 Model Y units sold despite a steeper price tag ranging from 263,500 yuan to 313,500 yuan. Meanwhile, BYD's highest-ranking vehicle, the Yuan UP SUV, managed only fifth place with nearly 97,700 units sold during the same period, while the Chinese car giant's overall passenger car sales dropped by more than 10% in the first half of the year. Traditional foreign automakers are steadily losing ground, leaving Volkswagen's compact gasoline-powered Lavida as the sole non-Chinese traditional foreign model in the top 10.
Why this matters
Mass-market budget hatchbacks displacing both foreign combustion models and established domestic EV leaders forces a structural shift toward volume-driven, low-margin assembly economics in Chinese auto manufacturing.
Samsung SDI to buy out GM's stake in battery joint venture
Samsung SDI is buying out General Motors' 49.99% stake in their battery joint venture in Indiana, taking full ownership of a plant that was supposed to produce 27 gigawatt hours annually by 2027. The two companies are unwinding the joint venture structure entirely because EV demand has grown more slowly than they forecast when they announced the partnership two years ago. GM pulled back on EV manufacturing after losing the $7,500 federal tax credit last September, and other automakers have followed suit, lowering factory output to match softer demand.
Under the new structure, Samsung SDI will own the Indiana facility outright as a wholly owned subsidiary. The plant, still under construction in New Carlisle, will initially focus on producing batteries for energy storage systems (ESS) rather than electric vehicles, where Samsung SDI sees faster near-term growth in the U.S. market. The two firms have signed a joint development agreement to work on next-generation prismatic battery cells for potential EV use, which could eventually be made at the same Indiana site. Samsung SDI did not disclose the financial terms of the stake .
The deal reflects a broader retreat in EV battery manufacturing. GM has also transformed another battery plant in Tennessee—a joint venture with LG Energy Solution—to produce ESS batteries instead. For Samsung SDI, the move preserves a North American foothold and keeps GM as a development partner without the commitment and demand risk of a 50-50 joint venture. For GM, it exits a venture that was built on demand assumptions that no longer hold.
Why this matters
Joint ventures in capital-intensive manufacturing collapse when demand forecasts miss, because fixed cost commitments cannot flex with volume—pushing partners toward asset ownership and alternative revenue streams.
CATL's battery breakthrough could advance flying car commercialization
CATL, the world's largest EV battery maker, has cleared a major safety test for aviation batteries and says the system is ready for mass production, according to scmp.com. The Ningde-based manufacturer announced Sunday that its aviation battery will first be deployed in Autoflight flying vehicles, marking the company's push beyond cars and trucks into passenger drones. CATL is not entering the flying-car market itself; it is supplying the critical component—the battery—to drone makers who will build the vehicles. The breakthrough matters because battery weight, energy density, and safety certification have been the binding constraint on commercial passenger drones. A supplier with CATL's scale and manufacturing discipline can compress the timeline from prototype to production. Second-order effect: if CATL's aviation batteries work at volume, Chinese drone makers gain a cost and supply-chain advantage over Western competitors still sourcing from smaller, less proven battery firms. CATL frames this as part of a broader decarbonization play—extending its energy solutions across transport modes—but the immediate commercial opportunity is narrower: equipping the first wave of air-taxi and urban-mobility startups that have the and regulatory pathways to launch in China.
Why this matters
A single supplier solving the binding constraint—battery certification—compresses the commercialization timeline for an entire category of vehicles, shifting competitive advantage to whoever secures that supplier's allocation first.
What it adds up to
Automakers are adjusting manufacturing strategies away from traditional electric vehicles toward battery storage and aviation applications to offset slowing automotive demand in Western markets. Concurrently, China continues to expand its dominant position in domestic electric car sales and next-generation vehicle technology. Whether alternative sectors like energy storage and passenger drones can absorb global battery production capacity left idle by sluggish auto sales is still open.
