Although China’s automobile sales in May reached 1.76 million units and total sales in the first half of the year are expected to exceed 10 million units, the growth rate continued to decline, down 3.57 percentage points over that in April to 9.81 percent, falling below 10 percent, according to the latest data released by China Association of Automobile Manufacturers (CAA).
The growth rate of passenger vehicles (cars, SUVs, MPVs and microvans) declined by 3.62 percentage points on a monthly basis. That of cars, SUVs and microvans dropped 4.45, 4.44 and 1.7 percentage points, respectively.
Commercial vehicle sales in May increased by 20 percent after sluggish demand in the first four months. Higher commercial vehicle demand and sales promotion of passenger vehicles have contributed to overall sales growth in May. But analysts believe that automakers have increased dealer inventories in May in preparation for the weak summer season. The seasonal sales pattern in most of the past years followed a declining trend month by month starting from April through July.
Demand for automobiles in June will continue to slow down in the summer months. In the regulatory front, the State Council’s 10 measures to curb the country’s worsening problem of air pollution will have a direct bearing on automobile demand as emission standards tighten, restrictions of vehicle registration and use being instituted in a growing number of cities and other policy measures come into place to curb air pollution.