China car slump persists as sales down for 10th month

By BLOOMBERG

BEIJING • For decades, there was just one way for China’s car market — up.

Once the trend abruptly reversed 10 months ago, the free fall in the world’s largest market has shown no signs of easing.

Retail sales of sedans, SUVs, minivans and MPVs continued their plunge in March, dropping 12% to 1.78 million units, the China Passenger Car Association (PCA) said yesterday. That follows an 18.5% drop in February and 4% decline in January.

A slowing economy and trade tensions with the US are weighing on consumer sentiment among China’s 1.4 billion population.

Cars was the only consumer product category in China that shrank in the first two months of 2019, said PCA secretary general Cui Dongshu.

“There are only 200 million private vehicles in China, leaving huge room for growth,” Cui said ahead of the report. “Policies should be put in place to spur vehicle consumption in 2019.”

Car sales may recover in April, helped by the country’s planned tax reductions, Cui said at a briefing in Beijing yesterday. He stopped short of predicting a year-on-year gain.

PCA raised its forecast for 2019 sales of new-energy vehicles — battery, plug-in hybrid and fuel-cell cars — to 1.7 million from 1.6 million.

The persisting slump threatens to leave global carmakers from Ford Motor Co and Toyota Motor Corp, to local players such as SAIC Motor Corp with few places to go for sales growth. — Bloomberg