Passenger vehicle sales fall as demand hit
Print Edition
PASSENGER vehicle sales in China fell in June as slowing growth in the world’s second-largest economy and plunging share prices dampened consumer demand, an industry group said yesterday.
Sales of saloon cars, multi-purpose vehicles, sport-utility vehicles and minivans declined 3.2 percent in June from a year ago to 1.43 million units, the China Passenger Car Association said.
The decline was a result of the stock market coming off the peak compounded with the slowdown in economic growth, the CPCA said in a statement.
China’s share market has lost around US$3.5 trillion in value in a rout that began last month, according to Bloomberg News.
“The stock market turmoil has led more people to put off their plan to buy new cars,” the CPCA said, adding that dealers complained that some customers who had put down deposits had become “unwilling” or “did not have the cash” to pay the balance of their purchase.
Downward pressures on the broader Chinese economy had also affected the auto market as growth in industrial companies’ profit slowed, according to the CPCA.
“All organizations’ car buying enthusiasm is waning,” it said.
Sales in the first six months of this year rose 8.4 percent year on year to 9.89 million units, the CPCA said.
China’s economy is in the grip of a slowdown as the government tries to engineer a transformation of the country’s growth model whereby consumer demand becomes the main driver rather than investment. GDP growth slowed to 7.4 percent in 2014, the weakest rate in 24 years.
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