General Motors was a pioneer in China, where for a quarter-century the company drew enormous profits and vied with Germany’s Volkswagen as the top seller of cars.

Those days are over.

G.M.’s sales in China have entered a death spiral, falling 42.5 percent in the first 11 months of this year. The company now ranks 16th by sales. The dizzying collapse of its China business forced G.M. to take a??against profits this month.

It was a drastic comedown for the company, which started in China in 1996 with an initial investment of $350 million and went on to build a network of factories, churning out vehicles and sending billions in profits to its headquarters in Detroit.

G.M.’s early China executives were highly responsive to the unique characteristics of the market. They built bulky minivans with lots of sparkling chrome to appeal to leaders of the state-owned companies that were big customers. They?, a faded brand in the United States that still had cachet in China. For rural farmers, G.M. offered vans and pickup trucks with flimsy seats and no air-conditioning that?.

In many ways, the story of G.M. in China tracks the experience of all foreign automakers in what is now the world’s largest car market.

China allowed foreign carmakers like G.M. into the country only as part of a publicly stated, long-term policy to gain technology and build its own globally competitive industry. Government leaders were also intent early on to shift away from cars that needed gasoline, which China mostly imports, and toward electric cars powered by energy sources at home like coal, solar and wind.

G.M. executives foresaw China’s strength, particularly in electric cars. “China is well positioned to lead in this,” David Tulauskas, an early G.M. director of China government policy, said in a 2009?.

But after years of success, G.M. has found it increasingly difficult to compete with Chinese rivals or adapt to the rise of electric cars.

Government policies that forced G.M. into joint ventures with Chinese companies meant that G.M. ended up teaching much of what it knew about car manufacturing to local rivals that now outsell it.

Since 2008, Beijing has collected??totaling more than 100 percent on large, imported cars and sport utility vehicles. The taxes are so high that G.M. does not even try to import some models, like the Cadillac Escalade. That full-size S.U.V. starts at $87,595 in the United States but costs $186,000 including tax in China, when purchased through an import agent.

Electric cars made in China face only a 13 percent tax.

In addition to wielding tax policy at foreign carmakers, Beijing limited or blocked government subsidies for cars built by foreign companies. Partly as a result, G.M. has not competed effectively in battery electric vehicles and plug-in hybrid cars. These models together accounted for 52.3 percent of the Chinese market in November, the China Passenger Car Association announced last week. That was up from 32.8 percent in January.

These fast-growing categories account for less than 20 percent of G.M. sales this year — while its sales of gasoline-powered cars have halved.

The Chinese market transformed much faster than anyone expected. The government’s??was for one in five cars sold in 2025 not to run on gasoline or diesel.

G.M. declined to make any executives available for interviews for this article. The company provided a statement expressing optimism that its main operations in China, a joint venture with the state-owned SAIC Motor of Shanghai that makes Chevrolets, Buicks and Cadillacs, would return to health.

“G.M. is working closer than ever with our joint-venture partner SAIC to restore the business in China to make it profitable and sustainable,” the company said. SAIC did not respond to requests for comment.

The architect of G.M.’s early successes was Philip F. Murtaugh, an obscure middle manager who had grown up on an Ohio farm. He went straight from high school in 1973 to the General Motors Institute, a company-sponsored college in Flint, Mich., where students worked while also taking classes. Mr. Murtaugh toiled in a factory that stamped car body parts.

Working up the ranks, Mr. Murtaugh, who spoke no Chinese, was given a crucial role on the team that negotiated G.M.’s joint venture with SAIC. While the rest of the team went back to the United States, Mr. Murtaugh stayed in Shanghai to run the new business.

China’s car market was tiny — 400,000 cars were sold in 1998. Today that number is 27 million.

One early win for the joint venture was the Buick GL8 luxury minivan for corporate fleets. Introduced in 1999, it was designed to maximize interior space but was just small enough to avoid being categorized as a commercial vehicle and tagged with a yellow sticker?on a fender. A quarter-century later, luxury-apartment parking lots in Beijing and Shanghai still have many of the latest GL8s.

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Next came the Buick LaCrosse sedan. In the early 2000s, Chinese consumers developed a growing taste for car ownership. G.M. executives noticed that many of these buyers were hiring drivers and riding in the back seat. Collaborating with SAIC, G.M.??with extra legroom for rear-seat passengers.

Rival executives watched the joint venture’s success and fumed. “I struggled with that, because I couldn’t persuade people in Detroit, in Auburn Hills, to pay attention to the back seat,” said Bill Russo, the top executive in China then for Chrysler, which had its headquarters in Auburn Hills, Mich.

Introduced in February 2006, the special LaCrosse minted fortunes for G.M. in China. A year later, as Chinese motorists demanded fuel economy and new technology, the joint venture introduced a gasoline-electric hybrid version of the LaCrosse.

Mr. Murtaugh arranged in 2002 for G.M. to pay just $31 million to buy a 34 percent stake in Wuling, an obscure Chinese manufacturer in the mountains of southwestern China. Wuling made spartan, low-price vans. G.M.’s top executives in Detroit were initially skeptical of investments in economy cars. They later raised the company’s stake in Wuling to 44 percent after the utilitarian vehicles proved popular in rural China.

But shortly before the first LaCrosse went on sale in China, and as Wuling’s potential was only starting to become clear, Mr. Murtaugh was?. His fast-growing and highly autonomous empire 7,000 miles from G.M. headquarters was earning close to $2 million a day by 2005. But the company’s North American operations were struggling, losing about $10 million a day.

G.M. leaders in Michigan decided to seek greater economies from large-scale production, the company’s century-old formula for success. They integrated the China joint venture’s car designs, procurement and other units into respective divisions in Detroit.

Mr. Murtaugh lost his independence and most of his authority, and resigned in protest. Unemployed at 49 for the first time in his life, he left Shanghai for a home in Kentucky. Mr. Murtaugh later worked briefly for SAIC and then a succession of Chinese start-ups, but did not repeat his success at G.M. He declined to comment for this article.

At the G.M.-SAIC joint venture, the pace of hits began to slow.

In 2007, the same year the LaCrosse hybrid went on sale, China’s premier, Wen Jiabao, chose a former Audi engineer,?, to become the country’s minister of science and technology. Mr. Wan would stay in the job for 11 years and, with instructions from the country’s top leaders to spend whatever it took, oversaw the initial conversion of the Chinese auto industry to electric cars.

“If you compare it to Western governments’ back and forth, the Chinese government’s unswerving commitment to the development of the E.V. market gave companies and investors the confidence to go forward,” said Stephen Dyer, a former Ford Motor executive in China who now leads Asia automotive consulting at AlixPartners.

In response to changes in the Chinese market, G.M. decided in 2011 to import the??plug-in hybrid, which had been developed with assistance from the Obama administration. But the Chinese government told G.M. that the Volt would not qualify for government subsidies — up to $19,300 per car — unless G.M. agreed to transfer electric car technology to SAIC Motor, like how to make powerful batteries that could be recharged many times.

G.M. faced pressure from Congress not to share technologies developed partly with federal money. The company agreed to transfer??to the joint venture, but not the Volt’s technology. As a result, the model did not qualify for the Chinese subsidies, which doomed it to be uncompetitive.

G.M. then became more cautious in its approach to China. Executives at Volkswagen, Ford and other automakers had long warned that G.M. was sharing too much advanced technology with SAIC. G.M. executives in the United States began to have the same worry.

The joint venture began building many cars in China using a lower-tech vehicle technology that lost appeal as the country became more affluent and Chinese automakers learned to build better cars. G.M. transferred designers and engineers from its Brazil and Mexico operations to Shanghai to replace higher-paid American engineers.

At the same time, SAIC was withdrawing Chinese engineers from the joint venture after they had worked with G.M.’s technology. SAIC assigned them to develop its own cars and minivans. Many of those SAIC vehicles would later compete directly with cars from its joint venture with G.M.

In 2016, G.M. tried again to offer a plug-in hybrid, the Buick Velite. Even though the batteries were made in China, Beijing??to buyers, without telling G.M. in advance, because the company making the batteries in China, LG, was South Korean.

When the pandemic began in early 2020, G.M. evacuated almost all foreign employees and their families from China, as did Volkswagen and other automakers. China’s borders were sealed to travelers. But Chinese automotive start-ups like?,??were investing heavily in robots and design innovations.

Today, Chinese automakers dominate their home market. SAIC, G.M.’s longtime partner, is among the most successful. Private Chinese companies emerging from the cellphone industry — like?,??and??— pose even more formidable competition.

Last week, G.M. shut its??in the United States. The initiative had been essential to the company’s long-term competitiveness in China, where the government is pushing faster for??than anywhere else in the world.

G.M. said it was not giving up on China.

In April, its joint venture with SAIC introduced a plug-in hybrid version of the GL8 minivan, which has had few changes since the 1990s. It is still the best-selling minivan in China. But SAIC has introduced an almost identical competitor, the Maxus G90.

G.M. began importing Chevrolet Tahoe full-size sport utility vehicles to China from the United States this year. And to bypass Chinese taxes, it is replacing their engines with much smaller ones.

Wuling, the maker of utilitarian minivans and pickups, is selling three times as many vehicles in China as mainstay G.M. brands. G.M. still profits from its 44 percent investment, but SAIC is the controlling shareholder in Wuling with a 49 percent stake.

G.M. said its China sales of electric and plug-in hybrid cars surpassed its sales of gasoline cars in late summer for the first time. Overall sales have increased each month since July. “Our results have begun to improve,” the company said.

But many in China see not just G.M. but all foreign automakers as dangerously behind. More than four-fifths of the electric and plug-in hybrid cars sold here are Chinese brands.

“It is not just G.M.,” said Mr. Russo, the former Chrysler executive, who is now a Shanghai electric car consultant. “Everyone among the foreign automakers had a condescending, arrogant attitude toward the capability of the Chinese companies to embrace innovation.”

Electric heat pumps, the most affordable and energy efficient way to heat and cool homes, continue to outsell gas furnaces nationwide. They can also reduce outdoor pollution and, as a result, save lives, according to?.

The study, by Rewiring America, a nonprofit group that promotes electrification, calculated that if every American household got rid of furnaces, hot water heaters and clothes dryers powered by oil or gas and replaced them with heat pumps and electric appliances, annual greenhouse gas emissions could drop by about 400 million metric tons. Fine airborne particulate matter and other air pollutants could decrease by 300,000 tons, the equivalent of taking 40 million cars off the road.

Roughly two-thirds of the country’s households burn fossil fuels such as natural gas, propane and fuel oil for heat, hot water and drying clothes, releasing nitrogen oxides and other pollutants into the air.

While a transition to electric appliances could shave $60 billion off people’s annual energy bills, it could also deliver important health rewards, researchers found. It could prevent 3,400 fewer premature deaths per year, 1,300 fewer hospital visits and 220,000 fewer asthma attacks, all of which amounted to about $40 billion in benefits, according to the study.

“Just swapping out appliances, it’s eye-opening in terms of the significant impacts,” said Wael Kanj, senior research associate with Rewiring America and the lead author on the report.

The amount of pollution reduction would depend on whether the electricity needed was generated by low-carbon sources like wind and solar power or came from gas or coal-fired power plants.

“The report rightly highlights the need to produce clean energy,” Rob Jackson, a climate scientist at Stanford University who has researched the health impacts of gas stoves, wrote in an email. “Electrifying our homes will have fewer benefits in West Virginia, where around 90 percent of electricity comes from dirty coal, than in other states with cleaner electricity.”

Mr. Kanj said if the grid decarbonized faster than forecast, the pollution reductions and health benefits would increase.

Yifang Zhu, a professor at the U.C.L.A. Fielding School of Public Health and an expert in air pollution, said the ways household appliances affected outdoor air pollution had largely gone understudied and that the new research helped fill in a gap. “Every sector needs to be looked at,” she said. “People can realize there are more benefits than just improved indoor air quality by electrifying households.”

The effect of gas stoves on indoor air came into sharp focus this past year after??in the United States and 50,000 cases of childhood asthma.

More American households are moving to heat pumps, which have outsold gas furnaces in recent years and are on pace to do so again in 2024.

The report from Rewiring America, titled “Breathe Easy,” drew from data, analyses and reports from a series of government agencies, including the National Renewable Energy Laboratory, the Environmental Protection Agency, the U.S. Census Bureau and the Energy Information Administration.

The American Gas Association, an industry group, contested the findings. A spokeswoman, Emily Carlin, pointed to the association’s own research, which found that it cost less to use natural gas in a new home compared to going all-electric. The group’s research found that high-efficiency natural gas appliances could yield fewer greenhouse gas emissions compared to an all-electric household and said that reductions in greenhouse gas emissions were similar to that of a heat pump in a colder climate.

The association also highlighted a study funded by the World Health Organization that found no significant increased asthma risk from home gas use compared with electricity, and a lower risk of bronchitis, though that study did find a possible increased risk of pneumonia and obstructive pulmonary disease.

Amy Andryszak, president and chief executive of the Interstate Natural Gas Association of America, called the study “inherently flawed” and said its calculations did not include increased costs on an electric grid that would come with getting rid of natural gas. “This is not a serious study, but rather an attempt to secure headlines with the same false and misleading talking points that activists have been using for years,” she said.

Under the Inflation Reduction Act, the federal government allocated nearly $9 billion in home energy rebates for electric appliances and energy efficient home retrofits. In 2023, more than 250,000 families claimed federal tax credits for heat pumps and more than 100,000 families claimed credits for heat pump water heaters. President-elect Donald J. Trump has said he wants to repeal the law. It’s unclear what that could mean for heat pump adoption, as many of the rebate funds have already been allocated to states.