Slowdown in China’s vehicle sales may decrease: NBS official

By Zhang Dan Source:Global Times Published: 2019/4/17 20:28:40

The rates of decrease in China's vehicle output and sales are expected to slow, National Bureau of Statistics (NBS) spokesperson Mao Shengyong told reporters at a press briefing on Wednesday.

Mao acknowledged that vehicle sales had slowed down for the past months and said the entire vehicle production and sales sector had entered a phase of adjustment. 

In the first quarter this year, China's vehicle sales fell 11.3 percent year-on-year to 6.37 million units, according to the China Association of Automobile Manufacturers.

Industry analysts told the Global Times even though the rate of decline might slow, it will be hard to see huge growth in the coming months.

"The numbers in the second quarter may be better than the first. Some Chinese customer prefer to buy new cars before the Spring Festival, which will increase vehicle inventories, followed by a potential market rise in the second quarter," Mei Songlin, a senior industry analyst, told the Global Times on Wednesday. 

The Chinese government has made great efforts to stimulate the vehicle market. Multiple departments in China issued documents in January to power up automobile sales in rural parts of China. The agenda of promoting vehicle sales in China's countryside was restarted after 10 years, according to the Economic Daily.

In addition, the cut in the value-added tax has also brought about lower vehicle prices. Leading companies such as Mercedes-Benz, BMW, Volvo and Jaguar Landrover all announced plans to lower official retail prices by amounts ranging from thousand of yuan to tens of thousands of yuan. 

Mao also told the press conference that China's used-car market should not be ignored because it is equal in size to almost half of the new-car market. 

According to the China Automobile Dealers Association, used-car sales reached 1.25 million units in March, growing 3.43 percent year-on-year. The value of used-car transactions reached 207.8 billion yuan ($30.95 billion) in the first quarter. 

China's used-car market is huge and many deals are not recorded, Wu Shuocheng, a Shanghai-based independent automobile analyst, told the Global Times on Wednesday. 

However, he noted that Chinese people's mindset about used cars is a barrier to the market's development, even if it has huge potential. 

"In addition, the used-car industry lacks regulation and supervision, which stops some consumers from buying used cars," Wu said. 

Mei said the weak sales performance of new cars must be having an impact on the used-car market.


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