Mercedes-Benz has slashed suggested retail prices for select models in China by about 10%, reports Caixin. This comes amid pressure from retailers struggling with widespread losses and mounting inventory in the world’s most competitive auto market.

The adjustment was confirmed by the auto dealers chamber of the All-China Federation of Industry and Commerce. The trade body, which had previously sent three letters to the German automaker regarding excessive inventory and delayed rebates, described the move as a pragmatic step to free up liquidity for dealers, though it said the measures still fell short of fully addressing grievances over the company’s overall business policy.

The price cuts underscore the deepening crisis for traditional luxury automakers in China, where an intensified price war and shifting sales models are eroding the profitability of dealership networks that long served as the backbone of foreign brands’ dominance.

The country’s top 100 developers reported combined contracted sales of RMB 165.5 billion (US$24 billion) in January, down 27% from a year earlier, reports the South China Morning Post, citing data released over the weekend by China Real Estate Information Corporation (CRIC).

Stress was particularly acute among offshore borrowers. The combined contracted sales of 18 major developers with outstanding US-dollar bonds fell 53.67% in January from December, and 18.51% year on year, a Barclays report published on Monday showed, pointing to weakening debt-repayment capacity.

Even after adjusting for seasonal effects, the month-on-month drop in January sales for these major developers was steeper than the post-Covid historical average decline of 44%, the British bank said.

China Vanke warned that its net loss for 2025 widened 65.7% year-on-year to approximately RMB 82 billion ($11.8 billion), reports Caixin. The deepening red ink at the state-backed giant underscores the severity of China’s property crisis, which has left Vanke with an estimated RMB 131.5 billion in losses over the past two years. 

The acceleration of losses toward the end of 2025 was particularly severe. Financial reports indicate the company lost approximately RMB 28 billion in the first three quarters of 2025, implying a massive deficit of roughly RMB 54 billion in the fourth quarter alone.

Vanke attributed the dismal performance to a sharp decline in settlement scale and persistently low gross margins caused by the industry downturn, according to an earnings forecast released on Friday. In 2025, the developer mainly delivered projects sold in earlier years and cleared existing inventory, most of which was built on land acquired before 2022, when prices were significantly higher.

Shares ​of BYD sank to their lowest level in at least a year on Monday, leading a broader selloff in ‌Chinese automaker stocks, reports Reuters. This came after they reported weaker sales in January as a revised subsidy scheme weighed on budget car brands.

The selloff underscores growing investor concern that China’s carmakers are heading into a prolonged slowdown as demand softens at home and policy support becomes less generous. Shenzhen-based BYD’s Hong Kong-listed shares ended down 6.9% at HK$91, marking their biggest one-day percentage drop since May 26, 2025, ‍after hitting the lowest in about a year during the day.

“Investors were likely surprised by the large degree of the domestic decline which implies a sharp market share loss,” said Eugene Hsiao, head of China equity strategy at Macquarie Capital. “Overall, we do not expect to see a ‌meaningful turnaround in domestic demand until BYD launches new models with higher value for money compared to rising competitors in ​the space,” he added.

Chinese liquor stocks rallied sharply Thursday, led by Kweichow Moutai, reports Caixin. This came about as recovering wholesale prices and robust pre-Lunar New Year demand reignited investor confidence in a sector that had been in decline for more than a year.

Shares of Kweichow Moutai surged 8.61%, while the CSI Liquor Index climbed 9.79% to close at 9,149.9. Several prominent distillers—including Wuliangye, Luzhou Laojiao and Shanxi Xinghuacun Fen Wine Factory—hit their daily trading limit of 10%.

The rally marked a pivotal shift for the embattled sector, which had been mired in a downturn since October 2024. Investors appear to be reassessing its outlook amid signs of supportive government policies and stabilizing premium liquor prices.