China Auto Shock: Xiaomi YU7 Crushes Tesla Model Y, BYD Sales Plummet 38%—What’s the Real Problem?

China’s Auto Market Earthquake: Xiaomi YU7 Dethrones Tesla Model Y. Why Is BYD Collapsing?

The October 2025 sales report for China’s passenger car market has finally been released, and the data paints a picture of nothing less than a seismic shift.

The overall passenger car market saw a slight pause, with 2.242 million units sold—a minor decrease of 0.8% year-over-year (YoY) and 0.1% month-over-month (MoM)¹. But this was the calm before the storm. Beneath the surface, New Energy Vehicles (NEVs) sold 1.282 million units, a 7.3% YoY increase, capturing a staggering 57.2% market penetration rate². The Chinese market is now, unequivocally, dominated by NEVs.

But the real story this month isn’t just the overall numbers. It’s about a new king being crowned and an absolute giant stumbling.

Today’s post will conduct a deep dive into the three most dramatic changes from the October sales data.

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🚀 1. The Coronation of Xiaomi YU7, The Fall of Tesla

The most shocking event this month is the Xiaomi YU7 (33,662 units) outselling the Tesla Model Y (19,488 units) for the first time³.

Looking at the model sales chart, the Xiaomi YU7 posted an explosive +50.5% MoM growth, vaulting it into the top 5⁴. In stark contrast, the Tesla Model Y faced a disastrous report card, plummeting -61.9% MoM and -46.2% YoY, sending it crashing down to 16th place⁵.

Tesla as a brand fared no better, with sales collapsing 64% MoM, knocking it completely out of the Top 20 brand rankings⁶.

What caused this dramatic reversal?

1. A Perfect Market Hit: The Xiaomi YU7, with its 800V high-voltage platform (400km range on a 10-min charge) in the 250,000-330,000 yuan price bracket, targeted the Model Y’s core customers with surgical precision⁷.
2. Youth Enthusiasm: Over 60% of YU7 buyers are young professionals and new families in their 20s and 30s⁸. They were drawn to both the “aspirational value” of its Porsche-like design and the “practical value” of the Xiaomi ecosystem⁹.
3. Tesla’s Innovation Stagnation: Tesla has not introduced a new model to the Chinese market since the Model Y in 2020¹⁰. Meanwhile, Chinese brands like Xiaomi and BYD are launching new vehicles almost every quarter. This difference in product iteration speed has directly translated into a difference in market share¹¹.

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📉 2. The King’s Dilemma: BYD’s Shocking Report Card

BYD still holds the #1 spot for brand sales (255,994 units)¹²¹²¹². But the numbers behind that rank are shocking. BYD saw a steep decline of -18.3% MoM and a devastating -38.0% YoY¹³¹³¹³.

The reason for the absolute giant’s stumble is the simultaneous failure of its core models:

• Seagull: Down -51.8% YoY (a complete collapse)¹⁴.
• Qin L: Down -52.0% YoY¹⁵.
• Qin PLUS: Down -11.2% YoY¹⁶.

BYD’s small car and affordable sedan lineup is losing ground to fierce competition from rivals (especially Geely and Wuling).

Of course, there is a silver lining. The newly launched “Titan 7” (钛7) model grew by an astonishing 146.4% MoM, breaking 20,000 units sold¹⁷. This new SUV, combining 200km of pure electric range with a 1300km hybrid range, has emerged as BYD’s new savior¹⁸.

However, this is a clear sign that BYD cannot rest on its past success and that relentless product innovation is its only path to survival.

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🌪️ 3. The Great Divide: Fates Decided for New and Old Guards

The October market clearly showed who is surviving and who is being left behind.

• The Rise of the New Guard:
  • Yinhe (Geely’s sub-brand): Ranked #4 (119,319 units), a 92% YoY explosion¹⁹¹⁹¹⁹.
  • Wuling: Returned to #5 (118,769 units). Its #1 model, the Hongguang MINIEV (61,506 units), reconquered the low-end market with nearly 80% YoY growth²⁰.
  • Leapmotor: Ranked #7 (63,724 units), showing consistent strength with 77% YoY growth²¹²¹²¹.
• The Fall of Traditional Joint Ventures:
  • Volkswagen (2nd) and Toyota (3rd) are still high on the list, but their growth is stagnant or negative (-17% and -8% YoY, respectively)²²²²²².
  • Their biggest problem is NEV penetration. In October, the NEV penetration rate for joint-venture brands was a pathetic 7%. In contrast, domestic Chinese brands hit 77.9%²³. In a market where the rules have already changed, they are losing market share with no way to fight back²⁴.

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📊 2025 October China Passenger Car Brand Sales (Top 20)

Rank	Brand	Oct Sales (Units)	Sep Sales (Units)	MoM Change	YoY Change
1	BYD	255,994	313,167	-18.3%	-38%
2	Volkswagen	166,500	161,926	2.8%	-17%
3	Toyota	142,913	142,190	0.5%	-8%
4	Yinhe	119,319	111,022	7.5%	92%
5	Wuling	118,769	98,078	21.1%	15%
6	Geely	90,820	75,434	20.4%	17%
7	Leapmotor	63,724	59,769	6.6%	77%
8	Nissan	61,290	55,323	10.8%	15%
9	Honda	58,889	54,324	8.4%	-22%
10	Chery	54,303	51,404	5.6%	-14%
11	Changan	53,133	61,133	-13.1%	-12%
12	Audi	49,700	56,550	-12.1%	3%
13	Xiaomi	48,654	41,948	16.0%	135%
14	Hongqi	44,908	39,805	12.8%	20%
15	BMW	44,478	44,106	0.8%	-14%
16	AITO	44,354	40,619	9.2%	27%
17	Haval	43,635	44,503	-2.0%	13%
18	Xpeng	37,014	36,577	1.2%	82%
19	Lynk & Co	36,800	29,838	23.3%	29%
20	Changan Qiyuan	36,339	41,188	-11.8%	37%

(Data Source: https://www.google.com/search?q=D1EV.com, CPCA) ²⁵²⁵²⁵

🚗 2025 October China Passenger Car Model Sales (Top 20)

Rank	Model	Oct Sales (Units)	Sep Sales (Units)	MoM Change	YoY Change
1	Hongguang MINIEV	61,506	51,743	18.9%	79.9%
2	Xingyuan	44,239	48,080	-8.0%	192.4%
3	Qin PLUS	35,338	39,132	-9.7%	-11.2%
4	Sylphy	33,903	33,323	1.7%	6.1%
5	Xiaomi YU7	33,662	22,369	50.5%	–
6	Boyue L	32,942	28,090	17.3%	145.0%
7	Haishi 06	26,011	30,532	-14.8%	–
8	Sagitar	25,038	24,622	1.7%	9.7%
9	Seagull	24,706	25,252	-2.2%	-51.8%
10	RAV4	23,213	19,712	17.8%	15.7%
11	Lavida	22,422	22,310	0.5%	-30.7%
12	Xingyue L	21,704	17,869	21.5%	-11.3%
13	Changan Lumin	20,520	23,188	-11.5%	20.4%
14	Titan 7 (Tiān 7)	20,024	8,128	146.4%	–
15	Yuan UP	19,813	25,919	-23.6%	-2.0%
16	Model Y	19,488	51,173	-61.9%	-46.2%
17	Camry	19,303	20,517	-5.9%	3.5%
18	Tuguan L	19,230	19,441	-1.1%	4.5%
19	Haval Dagou	18,875	17,524	7.7%	31.3%
20	Qin L	18,855	27,382	-31.1%	-52.0%

(Data Source: https://www.google.com/search?q=D1EV.com, CPCA) ²⁶

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🏁 Conclusion: The Race to 60% Penetration—Speed is Everything

The October data clearly shows that the competitive paradigm in China’s auto market has completely changed.

1. NEV Penetration at 57.2%: The era of “Should I buy an EV?” is over. We are now firmly in the era of “Which EV should I buy?” A 60% penetration rate by the end of the year is now within reach²⁷.
2. Innovation Speed Beats Brand Value: Tesla’s fall demonstrates how fatal innovation stagnation can be²⁸. In contrast, Xiaomi and other emerging Chinese brands are dominating the market with rapid product launches and tech upgrades.
3. The Domestic War Has Just Begun: The collapse of BYD’s main models is a sign that they are losing market share to the countless followers who benchmarked them²⁹.

With the Guangzhou Auto Show approaching, more new cars are about to be released. As companies make their final dash to meet year-end sales targets, the competition in China will only get hotter.

It’s truly exciting to wonder what new rankings next month’s report will bring.