Global electric vehicle (EV) sales rose 21% year-over-year in July, marking the slowest growth rate since January and down from 25% in June, according to market research firm Rho Motion. The slowdown was largely driven by weaker plug-in hybrid sales in China, the world’s largest auto market and home to more than half of all global EV sales.

China’s overall car market lost momentum in July, with BYD—the world’s largest EV manufacturer—posting its third consecutive monthly decline in registrations. The drop coincided with a temporary pause in certain 2025 government subsidies for EV and plug-in hybrid purchases.

Despite the slowdown in China, other markets helped sustain global EV demand. Europe posted a 48% sales surge to around 390,000 units, boosted by incentives aimed at accelerating decarbonization. North American sales rose 10% to more than 170,000 units, while sales in other regions climbed 55% to over 140,000 vehicles.

In total, 1.6 million battery-electric and plug-in hybrid vehicles were sold worldwide in July. China accounted for roughly one million units, though its year-over-year growth slowed sharply from an average of 36% in the first half of 2025 to just 12% in July.

“Despite regional variations, the overall trajectory for EV adoption in 2025 remains strongly upward,” said Rho Motion data manager Charles Lester.

Looking ahead, Chinese EV sales are expected to rebound from August as fresh subsidy funds are released. In the U.S., however, demand may face headwinds later in the year as a reduction in federal tax credits for new EV purchases and leases takes effect at the end of September.