AutoBeta(AutoBeta.net)08/11 Report--

The decline in China's car sales narrowed further in 2020, with double-digit growth in July. According to the China Association of Automobile Manufacturers, car sales in China reached 2.112 million in July, up 16.4 percent from a year earlier, the highest monthly increase so far this year.

On the one hand, the overall recovery of economic operation has improved, coupled with various policies to promote consumption, which have helped to increase car sales; on the other hand, under the influence of the switch between the five countries and six countries in June last year, consumption was overdrawn ahead of schedule, resulting in a sharp drop in sales in July last year, with a low base year-on-year. Sales in July fell 8.2 per cent month-on-month, compared with 2.3 million in June 2020.

Judging from the cumulative sales in 2020, China's car sales from January to July reached 12.365 million, down 12.7% from the same period last year, further narrowing the decline. According to the current sales trend, full-year sales are expected to achieve a single-digit decline, or even return to positive growth.

Specifically, commercial vehicles perform better than passenger cars. From January to July this year, the cumulative sales of passenger vehicles in China were 9.533 million, down 18.4% from the same period last year, while the cumulative sales of commercial vehicles were 2.832 million, up 14.3% from the same period last year.

But as car sales pick up, so does the overall inventory level. By the end of July, China's total automobile inventory had reached 1.085 million, including 788000 passenger vehicles and 296000 commercial vehicles. The China Automobile Association also reminded the major mainframe factories to pay attention to the inventory situation while promoting sales growth, and do not blindly put pressure on the warehouse.

After 12 months, the monthly sales of new energy vehicles are finally growing. According to the data, sales of new energy vehicles reached 98000 in July, up 19.3 percent from the same period last year, and cumulative sales from January to July 2020 reached 486000, down 32.8 percent from the same period last year.

From the perspective of the industry pattern, it will still show a gradual concentration to the head car enterprises, and the weak brands will face the trend of elimination. There is a view that, with the help of the transformation and upgrading of the industry, the concentration of the industry will continue to increase, the survival of the fittest among enterprises is accelerating, differentiation will intensify, some brands will gradually withdraw from the competition, and some dealers will also close or sell their business.

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