On Friday, VW reported first-half sales of 1.54 million vehicles in China. Though that's an 18 percent increase year-over-year, VW did not pass General Motors, which sold 1.57 new vehicles over the same time period.
(Read More: America Is Losing Its Gas-Guzzling Ways)
GM and VW have long led the Chinese market, mainly because they were among the first of the global automakers to aggressively set-up production in China when it began welcoming foreign investment in the mid 1990s.
As a result, the race to hold first place in the country has become a proxy for the battle the companies are waging to be the global leader in auto sales. Last year, General Motors was tops, selling more than 9 million vehicles, while Volkswagen was third behind Toyota.