Tesla experienced a significant resurgence in China last month, with retail sales increasing by 40.7% in August compared to July, according to data from the China Passenger Car Association (CPCA). The company sold 57,152 vehicles locally, a substantial improvement from the 40,617 units sold in the previous month, making it one of the strongest month-to-month improvements in 2025.
Wholesale deliveries also saw a surge, with Tesla’s Shanghai Gigafactory producing 83,192 vehicles in August, reflecting a 22.6% increase from July. Among these vehicles, 24,304 were Model 3 sedans, 58,888 were Model Ys, and 26,040 units were exported. The Model Y continued to dominate, accounting for 69% of local sales and securing its position as the second best-selling vehicle in the country.
Despite the positive momentum in August, Tesla still faces challenges in China. Year-over-year retail sales for August were down by 9.9% compared to the same month in 2024, marking the sixth decline in eight months this year. From January through August, Tesla delivered a total of 361,179 cars in China, which represents a 6.9% decrease compared to the previous year. Wholesale sales during the same period also experienced a decline of 12.2% from last year.
Competition in China’s electric vehicle market remains fierce, prompting Tesla to recently reduce the price of its newly launched Model 3 Long Range RWD by $1,400 to better compete with local rivals. Additionally, the introduction of the Model Y L, a three-row, six-seat variant of Tesla’s popular electric SUV, has been well-received. Reports indicate that the Model Y L received an average of 10,000 orders per day in its initial weeks on sale, with domestic deliveries already underway.
Despite the year-over-year declines, Tesla managed to expand its market share within China’s new energy vehicle sector. The company captured 5.2% of NEV sales and 8.3% of the battery electric vehicle market in August, up from 4.1% and 6.7% in July, respectively.
Looking ahead to September, Tesla’s recent product launches and pricing adjustments are expected to provide an additional boost in the final month of the quarter. The company continues to innovate and adapt to the evolving market dynamics in China, demonstrating its commitment to maintaining a strong presence in the region.