China Auto Sales on Track for a Down Year

China Auto Sales on Track for a Down Year

SHANGHAI—The slump in China’s automotive sector dragged on through October, with year-over-year sales down for the fourth straight month.

Auto sales last month were off 12% from a year earlier to 2.38 million, the government-backed China Association of Automobile Manufacturers said Friday. With that, 2018 turned negative: Sales for the first 10 months were down 0.1% from 2017.

Sales were down 12% in September, and 4% in both July and August.

Unlike during past slowdowns, the Chinese government has declined to intervene to stimulate the market with tax cuts. Some industry analysts say that is likely to change soon, as Beijing works to pump up an economy weighed down by burdens including the trade fight with the U.S.

The manufacturers’ association, however, said a tax cut isn’t the answer.

“We do not advocate short-term stimulus measures. We support long-term policies that can help the industry to grow at a slow and steady pace,” said Shi Jianhua, the association’s deputy secretary-general.

Passenger-car sales were down 13% in October, to 2.05 million, and 8% for the third quarter. That puts them off 1% for the first 10 months of the year, on course for their first yearly decline in nearly three decades.

Sales of commercial vehicles were down 3% last month to 333,000, but that still left them up 5.5% for the year through October.

Electric vehicles were the sole area of growth last month, with sales up 51%. Sales for the first 10 months of the year were up 76%, to 860,000—on track to break the 1 million barrier for the first time, thanks largely to government policies.

A senior official at the National Development and Reform Commission, the country’s economic-planning agency, said Tuesday that 2018 vehicle sales would fall short of last year’s total of 28.88 million.

Wu Wei, speaking at a major trade expo in Shanghai, warned auto makers against “expanding blindly” and urged them to carefully target investment in this new era of low or zero growth for the country’s auto producers.

A confluence of economic factors is dissuading potential buyers, according to auto analysts. A general sense of pessimism about the Chinese economy, fueled partly by the trade dispute with the U.S., is deterring consumer spending, while credit has tightened in many smaller cities.

In affluent cities such as Shanghai falling stock prices have hit disposable income, denting demand for premium and luxury vehicles.

Write to Trefor Moss at

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