In the first half of 2026, BMW, Audi, and Mercedes-Benz all reported year-on-year declines in sales in the Chinese market. BMW’s sales dropped by more than 20%, while Audi and Mercedes-Benz fell by 19% and 28%, respectively. Monthly sales of key models—including the BMW 5 Series, Audi A6L, and Mercedes-Benz E-Class—each failed to reach the 10,000-unit mark. China is no longer BMW’s largest single market globally, and the brand’s premium pricing power continues to weaken. To alleviate inventory pressure, both BMW and Audi launched large-scale price-cut promotions. BMW offered discounts of nearly RMB 300,000 on its flagship all-electric models, while several gasoline-powered SUVs saw price reductions exceeding RMB 70,000. Audi simultaneously cut prices across its dual joint-venture lineup, bringing the base price of the A6 into the RMB 250,000 range. Meanwhile, the penetration rate of new energy passenger vehicles in China remained stable above 60%. Consumer preferences have shifted toward features such as intelligent driving, 800V high-voltage fast charging, and smart cabins. In contrast, the electric transition of the German luxury trio—BMW, Benz, and Audi (BBA)—has lagged significantly. BMW’s new energy vehicle penetration rate in China stood at just 6.2%, and its early “oil-to-electric” converted models clearly trail domestic premium brands in terms of range and intelligence. Domestic brands like Li Auto, NIO, and Xiaomi are steadily attracting former BBA prospects with high-spec, smart EVs priced between RMB 300,000 and RMB 500,000, coupled with lower ownership costs. Audi also faces internal friction between its two joint ventures—SAIC Audi and FAW Audi—with SAIC Audi’s models suffering weak sales and relying heavily on discounts to sustain operations. Currently, BMW has discontinued its outdated oil-to-electric models and shifted focus to launching vehicles based on a dedicated all-electric platform. Audi, too, is accelerating the development and rollout of locally tailored smart electric vehicles.