Industry growth slows as China’s factory profits rise 4.2%

China’s industry sector saw slower profit growth in August. Profits at large industrial firms rose 4.2% from a year earlier. This was the slowest growth this year. It was also the fourth month in a row that profit growth slowed.

Tech firms lead growth

Some high tech businesses are doing very well. Companies that make computers, chips and other electronic goods saw strong profit growth. Profits in computer, communication and electronic equipment rose 110% from January to August. AI and robotics are helping these industries grow.

Car makers face pressure

The auto industry had a much harder time. Car makers saw profits fall 16% in the first eight months of the year. Strong competition and price cuts have hurt many companies. Other consumer businesses also saw weaker profits. These include clothing and furniture makers.

China faces weak demand

China’s factories are also dealing with weak demand at home. A long slowdown in the property market has hurt spending and investment. Factory activity fell for the second month in a row in August. Strong exports have helped support industrial output.

For the first eight months of the year, industrial profits still rose 15.7%. But this was lower than the 17.6% growth recorded through July. Economists expect China’s government to take more steps to support the economy. Possible projects include power grids, water systems, data centers and transport networks.

The latest figures show that China’s industry is growing at different speeds. High tech businesses are gaining from the AI boom while many traditional industries continue to face pressure.