China’s personal luxury market showed signs of stabilization in 2025, reports Caixin, with a modest recovery in the final quarter as consumers shifted spending back to domestic channels. 

Sales for the year fell by 3% to 5%, a significant improvement from the 17% to 19% decline in 2024, according to a report released Thursday by Bain & Company.

This stabilization signals a potential turning point for a sector that has long been a key growth engine for global luxury brands. However, consumption habits are shifting, with an increasing focus on value and experiential luxury. Bain expects the market to resume moderate growth in 2026, reaffirming the Chinese mainland’s crucial role in the global luxury industry despite recent slowdowns.

China’s automobile sector posted record revenue of RMB 11.2 trillion ($1.6 trillion) in 2025, up 7.1% year-on-year, while profit growth failed to keep pace, sinking to a record monthly low of 1.8% in December 2025, dragging the full-year average to just 4.1%, reports Caixin. This is according to data released Tuesday by the China Passenger Car Association (CPCA), citing the National Bureau of Statistics.

Last year’s 4.1% profit margin fell below the 5.9% average across China’s industrial sector and extended a decline from the 2014 peak of 8.99%. December’s margin was the lowest in five years outside of major disruptions. The only worse month was April 2022, when strict Covid-19 lockdowns drove margins down to 0.7%.

Cui Dongshu, secretary-general of the CPCA, said government subsidies supporting vehicle trade-ins have boosted demand, but the industry’s productivity gains remain weak compared with other consumer sectors.New-energy vehicles (NEVs), which favor volume over immediate profit, are increasingly shaping market dynamics. NEV production jumped 25% to 16.52 million units in 2025, while output of internal combustion engine vehicles shrank 1% to 18.25 million.

Pop Mart extended its rally in Hong Kong on Wednesday after unveiling an accelerated push into the US market, reports the South China Morning Post. The rise underscores how overseas expansion is helping the Chinese toymaker offset lingering pressures at home, says the Post.

The maker of Labubu figurines plans to open more than 20 new stores across the United States this year, under a partnership with US mall operator Simon Property Group, which announced the roll-out in mid-January. The outlets will be located in major shopping centres including King of Prussia in Philadelphia, Sawgrass Mills in Florida and The Westchester in New York, marking a step-change in Pop Mart’s overseas ambitions.

Shares of Pop Mart climbed as much as 9 per cent to HK$236 in afternoon trading, before ending 7% higher at HK$231.4, extending a rebound fuelled by a HK$350 million (US$45 million) share buy-back last week. The stock has now risen more than 32% from its year-to-date low of about HK$174.

Porsche AG’s sales in China slumped for the fourth straight year in 2025, dropping to 42,000 units—less than half the 96,000 vehicles the German luxury carmaker delivered at its 2022 peak, reports Caixin. The carmaker is struggling with what its China chief called a “perfect storm” of economic strain and intensified domestic competition.

Alexander Pollich, president and CEO of Porsche China, acknowledged the downtrend in a January 26 interview, citing a seismic shift in Chinese consumer preferences. Buyers increasingly demand advanced digital features, areas where domestic are outpacing foreign rivals.

The falloff highlights the mounting pressure on traditional Western luxury brands in the world’s largest car market. Chinese players, many with roots in the internet and smartphone industries, are rapidly redefining premium mobility with aggressive pricing and superior digital integration.

LVMH, the owner of Louis Vuitton and Tiffany, beat fourth-quarter sales forecasts on Tuesday, reports Reuters, boosting hopes of a luxury sector rebound.

The French group reported signs of a return to growth in Asia, with domestic Chinese sales rising in the quarter, confirming a recovery it has flagged for several months. Chinese shoppers—including those abroad—account for an estimated one third of all sales.

Total quarterly sales at the world’s largest luxury group came in at 22.7 billion euros ($27.1 billion), up 1% on a like-for-like basis versus expectations of a 0.3% decline in a consensus compiled by Visible Alpha.