China’s April car sales rebound for 1st time in 22 months, buoyed by stimulus steps

12, May. 2020

Photo by Nick Fewings on Unsplash
Photo by Nick Fewings on Unsplash

TOKYO, NNA – China’s new vehicle sales rebounded for the first time in 22 months in April, buoyed by government stimulus measures to revitalize consumer sentiments in the world’s largest automotive market.

The total monthly car sales rose 4.4 percent from a year earlier to 2.07 million units, the first increase since June 2018, according to data released by the China Association of Automobile Manufacturers on Monday.

The increase is attributable to a jump in commercial vehicle sales, which logged 31.6 percent on-year to a record of 534,000 units. The sales of passenger cars dipped 2.6 percent from a year ago to 1.54 million units, the data showed.

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With the spread of the novel coronavirus has been contained, the central and local governments stepped up efforts to invigorate car purchases, the industry body said, adding that automakers and dealers also intend to store some reserve stock.

The central government has decided to delay a full introduction of stricter emission standards China 6 to January 2021 from the initially scheduled in July this year. Local governments also have implemented their own subsidy schemes to help buy vehicles.

But such steps failed to boost sales of environmentally-friendly cars in the reporting month. The sales of those called New Energy Vehicles plunged 26.5 percent on-year to 72,000 units, according to the data, underlining that subsidies and tax reliefs by the central government were not enough to stoke demand for eco-vehicles.

For the January-April period, total new vehicle sales tumbled 31.1 percent from a year earlier to 5.76 million units. The sales of passenger cars plummeted 35.3 percent to 4.43 million units, while those of commercial vehicles fell 12.4 percent to 1.33 million units, according to the data.

Purchasing power still seems weak, and the industry might face a parts supply shortage from overseas due to the global Covid-19 pandemic, said the association.

New vehicle sales this year would fall 15 percent if the overseas pandemic ceased during the April-June quarter, but they would decrease 25 percent if the worldwide outbreak persisted in the second half of this year, it added.