GM’s 20% Sales Surge in China: A Real Comeback or a Statistical Illusion?

In a Chinese auto market where giants are falling, two starkly different report cards just landed. Mercedes-Benz announced a painful 19% sales drop in China, citing tariffs and fierce competition. In the same market, General Motors posted a stunning 20% year-over-year sales increase.

How did GM achieve this solitary success while others stumbled? At first glance, it looks like a spectacular turnaround. But the truth is far more complex.

A Tale of Two Automakers: Why Mercedes Fell and GM Rose

The contrast between the two is a perfect illustration of the market’s challenges.

Q2 2025 Comparison	General Motors (in China)	Mercedes-Benz (in China)
Total Sales Growth	+20% (447k units)	-19% (140k units)
NEV / EV Sales	+50% (in China)	-24% (Global BEV)
Key Factors	Growth: Base Effect, MPV/ICE Strength<br>Challenge: Mainstream EV competition	Decline: US-China Tariffs, EV Competition<br>Challenge: Structural market headwinds

Mercedes-Benz’s decline is straightforward: it’s facing real, structural problems. Its US-made SUVs (like the GLE and GLS) are hit by retaliatory trade tariffs, and its flagship EVs are struggling against local champions like BYD.

So, did GM solve these problems? Not exactly. Their success story has a different origin.

The Truth Behind GM’s Surge: The “Crouching” Strategy of 2024

The biggest secret to the 20% growth lies in 2024. Facing a sales freefall, GM implemented a “crouching” strategy: they minimized spending and accepted a steep sales decline to survive. This created an abnormally low sales base for Q2 2024.

Consequently, the 20% growth in Q2 2025 is largely a product of the “base effect”. This isn’t a comeback from strength; it’s a normalization from an extreme low.

Conclusion: The Start of a Revival, or a Fleeting Recovery?

GM’s Q2 performance is a sign that the worst is over, but it’s not yet proof of a sustainable revival. By focusing on its strongholds (MPVs, budget EVs) while avoiding the main EV battlefield where Mercedes is struggling, GM bought itself time. But the real test—proving it can compete in the mainstream EV market—is still to come.

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