China's burgeoning auto industry is impacting the balance of trade, with car exports rising as imports fall. This shift reflects not only changing market dynamics but also tensions from the ongoing trade dispute with the US, according to Carscoops.

Data from the China Automobile Dealers Association (CADA) reveals that car imports to China dropped 25% to 47,000 vehicles in May. Year-to-date imports for 2025 are down about 33% to 180,000 vehicles.

Cadillac XT5 - a model imported from the US to China. Photo: Cadillac

Cadillac XT5 - a model imported from the US to China. Photo: Cadillac

Imports of passenger cars from the US to China plummeted 68% in May to 3,130 vehicles. This decline is not an isolated incident; in the first five months of 2025, imports fell 48% to 18,849 vehicles.

A tariff ceasefire agreement offered a glimmer of hope for stability. On 12/5, China and the US agreed to a 90-day pause on tariff increases, but existing tariffs remain a significant factor. In China, US cars with engines larger than 2.5 liters face a 25% tariff, while models with smaller engines are subject to a 15% tariff.

Meanwhile, the US hasn't exactly rolled out the welcome mat. In addition to its own tariffs, the US has finalized rules that will effectively ban all car imports from China, citing national security concerns. The new regulations target the "sale or import" of connected car software originating from so-called "countries of concern," a label that includes China.

While CADA doesn't break down import figures by brand, some of the largest importers include General Motors, Ford, and Tesla. German automaker BMW also exports a significant number of vehicles from the US to China.

Japanese automakers comfortably lead the list of countries exporting the most cars to China, with a total of 70,037 vehicles in the first five months of 2025. Germany follows with 41,675 vehicles, and Slovakia with 25,833.

BYD's NEVs prepared for export. Photo: BYD

BYD's NEVs prepared for export. Photo: BYD

In contrast to slowing imports, China's car exports continue to accelerate. In the first five months of the year, China exported 2.83 million vehicles, a 16% increase year-over-year. May was a particularly strong month, with 682,000 vehicles exported, up 20% compared to May 2024. Unsurprisingly, China's NEVs (including battery electric vehicles and plug-in hybrid electric vehicles) are proving especially popular.

In May, China's total NEV exports reached 296,000 vehicles, a 43% increase. The country's top markets for NEVs include: Brazil (35,478 vehicles), Belgium (30,405 vehicles), the Philippines (21,517 vehicles), the UK (21,456 vehicles), Mexico (14,587 vehicles), and Australia (14,250 vehicles).

Minh Vu (Carscoops)