Carmakers hurting as China sales slide
CAR sales in China continued to decline in January after their first full-year slump in more than two decades, adding to pressure on automakers who bet heavily on the market amid waning demand for cars from the US to Europe.
Passenger vehicle wholesales fell 17,7 percent year-on-year, the biggest drop since the market began to contract in the middle of last year, while retail sales had their eighth consecutive monthly decline, industry groups reported Monday.
“Downward pressure is still there,” Gu Yatao, a Beijing-based auto analyst with Roland Berger, said before the figures were released. “The government isn’t adopting stimulating policies to give the market a shot in the arm.”
The persisting slump leaves carmakers with few places to go for sales growth. The markets in Europe and North America are shrinking as the increasing availability of ride-hailing and car-sharing services makes it less necessary to own a car. Japan is sputtering too, while volumes in other smaller markets aren’t enough to offset the declines in the biggest sales regions.
Sales in China continue to be suppressed as the world’s second-largest economy slows and negotiations with the U.S. for a trade-war truce drag on. Consumers stayed away from showrooms even with discounting by dealerships ahead of the Chinese New Year Holiday.
The wholesale decline in January, to 2,02 million units, accelerated from a 15,8 percent slump in December, the China Association of Automobile Manufacturers said. For last year as a whole, the drop was 4,1 percent, the first decrease since the early 1990s. Retail sales dropped 4 percent to 2,18 million units, China Passenger Car Association said. – Bloomberg