China's auto sales plummeted 25% in February compared with a year earlier, hitting 1.03 million units as government subsidies for electric vehicles were reduced. This sharp drop, a 33% decrease from January, marks the sector's weakest performance since the Lunar New Year holiday disrupted demand. While domestic passenger car sales cooled, Chinese EV exporters saw growth, highlighting the uneven impact of Beijing's policy shift. The subsidy cuts directly correlate with the sales slump, as consumers delayed purchases anticipating further reductions. This trend suggests the government's cost-control measures are successfully tempering EV demand, potentially reshaping the market's growth trajectory.