Related News
Home 禄 Business 禄 Autotalk Special
The pickup in car sales: false start or trend sign?
By Lu Nengneng |
July 22, 2013, Monday
|
Print Edition
Print Edition
AFTER driving at low speeds over potholes the past two years, China's auto market apparently stepped on the gas in the first quarter of this year. But the road ahead is still flashing a yellow caution light for car manufacturers and dealers.
Vehicle sales in China in the first half rose 12.3 percent from a year earlier to 10.78 million units, exceeding the widely-held 8 percent growth forecast for 2013. Deliveries of passenger cars went up 13.8 percent to 8.67 million units.
Cui Dongshu, deputy secretary-general of the China Passenger Car Association, said the unexpected sales spurt so far this year is probably attributable to several factors.
For one, carmakers have been picking up their pace of new model releases and manufacturing expansion since late last year. For another, dealerships have been offering deeper discounts to attract buyers, making 90 percent of vehicles their cheapest in several years.
Then too, pent-up consumer demand and rumors that more cities will soon impose tighter restrictions on vehicle ownership drove more people into showrooms.
"But we are only cautiously optimistic about the market trend for the second half of this year," said Cui.
China's gross domestic product growth has slowed for two straight quarters, making it difficult to see any strong expansion in the auto sector, said Xu Changming, director of Information Resource Department at the State Information Center.
In fact, the car sales figures for the first half of this year were inflated to some extent because they were sourced from manufacturers, who base their numbers on deals with dealerships, rather than on consumers, he added.
The State Information Center said the average inventory level at dealerships rose to 1.6 months in June from about 27 days at the end of last year.
The gap is equal to the number of cars sales already reported but not yet realized, Xu said.
Luo Lei, deputy secretary-general of the China Car Dealership Association, agreed that sales statistics are distorted. He prefers to use consumption data compiled by the National Bureau of Statistics, which show car-buying rose 8.8 percent in the first half of this year.
In the remaining six months, dealerships need to brace for a lot of uncertainties, said Luo.
As carmakers keep pushing full-year sales targets - some of which were recently upgraded after the stronger-than-expected first-half performance - the risk of larger inventory backlogs looms. Summer is traditionally a slack season for auto sales in China.
Meanwhile, networks of car dealerships continue to expand, Luo noted. They rose 16.6 percent last year and 28 percent in 2011 - outpacing market sales. That suggests profit margins will be squeezed further and many dealers may find themselves cash-strapped.
Vehicle sales in China in the first half rose 12.3 percent from a year earlier to 10.78 million units, exceeding the widely-held 8 percent growth forecast for 2013. Deliveries of passenger cars went up 13.8 percent to 8.67 million units.
Cui Dongshu, deputy secretary-general of the China Passenger Car Association, said the unexpected sales spurt so far this year is probably attributable to several factors.
For one, carmakers have been picking up their pace of new model releases and manufacturing expansion since late last year. For another, dealerships have been offering deeper discounts to attract buyers, making 90 percent of vehicles their cheapest in several years.
Then too, pent-up consumer demand and rumors that more cities will soon impose tighter restrictions on vehicle ownership drove more people into showrooms.
"But we are only cautiously optimistic about the market trend for the second half of this year," said Cui.
China's gross domestic product growth has slowed for two straight quarters, making it difficult to see any strong expansion in the auto sector, said Xu Changming, director of Information Resource Department at the State Information Center.
In fact, the car sales figures for the first half of this year were inflated to some extent because they were sourced from manufacturers, who base their numbers on deals with dealerships, rather than on consumers, he added.
The State Information Center said the average inventory level at dealerships rose to 1.6 months in June from about 27 days at the end of last year.
The gap is equal to the number of cars sales already reported but not yet realized, Xu said.
Luo Lei, deputy secretary-general of the China Car Dealership Association, agreed that sales statistics are distorted. He prefers to use consumption data compiled by the National Bureau of Statistics, which show car-buying rose 8.8 percent in the first half of this year.
In the remaining six months, dealerships need to brace for a lot of uncertainties, said Luo.
As carmakers keep pushing full-year sales targets - some of which were recently upgraded after the stronger-than-expected first-half performance - the risk of larger inventory backlogs looms. Summer is traditionally a slack season for auto sales in China.
Meanwhile, networks of car dealerships continue to expand, Luo noted. They rose 16.6 percent last year and 28 percent in 2011 - outpacing market sales. That suggests profit margins will be squeezed further and many dealers may find themselves cash-strapped.
- About Us
- |
- Terms of Use
- |
-
RSS - |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 娌狪CP璇侊細娌狪CP澶05050403鍙-1
- |
- 浜掕仈缃戞柊闂讳俊鎭湇鍔¤鍙瘉锛31120180004
- |
- 缃戠粶瑙嗗惉璁稿彲璇侊細0909346
- |
- 骞挎挱鐢佃鑺傜洰鍒朵綔璁稿彲璇侊細娌瓧绗354鍙
- |
- 澧炲肩數淇′笟鍔＄粡钀ヨ鍙瘉锛氭勃B2-20120012
Copyright 漏 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.
