AutoBeta(AutoBeta.net)08/09 Report--

The report card of passenger car sales in China finally came out in July, ending a 12-month decline in sales due to destocking in June, but the grim situation in the car market failed to improve in July and declined again.

According to July passenger car production and sales data released by the Federation of passengers, sales of narrow passenger cars in July were about 1.4854 million, down 15.9 per cent from the previous month and 5 per cent from the same period last year. Wholesale sales of narrow passenger vehicles nationwide were 1.527 million, down 2.6 per cent from the same period last year. The trend of the downturn has not been reversed.

The data also showed that retail sales fell 16 per cent year-on-year in the first four weeks of July, down sharply from 5 per cent in the first four weeks of June.

The domestic car market sales continued to decline in July, mainly due to the fact that some parts of our country experienced five to six in June, overdrawn ahead of time, and the price was recovered in July, so the sales volume still did not improve.

Due to the tight time and heavy tasks of the five-year inventory digestion in June, coupled with the continued weakness of terminal consumption since the first half of this year, it has brought tremendous pressure on dealers and manufacturers. Therefore, dealers choose self-digestion to achieve retail, through price promotion to stimulate consumer demand. After the switch, car prices rebounded and consumer demand decreased, resulting in a rebound in prices in July and a decline in sales compared with the same period in June.

In addition, at present, consumer confidence is generally not strong, the performance of first-purchase demand is far worse than that of swap demand, and the property market brings greater debt pressure to residents, which has a greater impact on the purchasing power of the car market, which is not conducive to the resumption of growth of independent brands.

Moreover, July and August belong to the traditional off-season of the domestic automobile market. Due to the hot weather and the rainy season in most areas, the number of passengers gathered decreased significantly; in addition, due to the influence of local customs in some areas, consumers will not buy cars before and after August, and their willingness to buy cars is weak, so it is expected that the market performance in August will be lacklustre, and sales will decline compared with July.

Recently, a number of car companies released sales data show that they have been affected by varying degrees of decline, especially independent brands have a greater impact. However, it is worth noting that the sales of fuel vehicles have declined, and the sales of new energy vehicles have grown rapidly.

Geely announced that according to the latest sales figures released by Geely, Geely sold a total of 91375 vehicles (including Lecks) in July, up nearly 1% from the previous month and down 24% from a year earlier.

Jianghuai Motor (4.850,-0.13,-2.61%) sold 27600 vehicles in July, down 27.29% from a year earlier. Of this total, pure electric passenger car sales were 1738, down 66.5% from the same period last year. The cumulative vehicle sales from January to July were 262700, down 9.46% from the same period last year. Of this total, sales of pure electric passenger cars were 40800, an increase of 61.79 per cent over the same period last year.

BYD's July sales figures fell nearly 17 per cent from a year earlier to 30985 vehicles. Of these, sales of new energy vehicles were 16567, down 11.84 per cent from a year earlier and nearly 10, 000 fewer than in June, while fuel vehicle sales were 14418, down 22.16 per cent from a year earlier.

Most luxury brands and joint ventures grew. Mercedes-Benz sold 59435 vehicles in China in July, up 13 per cent from a year earlier, setting a record for Mercedes-Benz's cumulative sales in the first seven months of July. Audi sold 56223 new cars in China in July, up 6.1% from a year earlier, while Honda sold 56223 new cars in July, up 6.1% from a year earlier.

For now, the "cold winter" of the car market will continue, and the China Automobile Association recently lowered its sales forecast for this year's domestic car market from 28 million to 26.68 million, down 5 per cent from a year earlier. At the same time, some car companies have lowered their annual sales targets.

The Federation predicts that with the announcement catalogue and supply of national six models gradually in place, as well as the arrival of the new car market trend in August, production and sales have great potential to rebound in August. "at present, the market demand is relatively weak, and the real recovery should be after August." Cui Dongshu, secretary-general of the Federation of passengers, said.

The policy stimulus brought a brief recovery in the auto market in June, but the temporary recovery did not last, inventory clearance ended, and the auto market returned to a continued downward trend. Even for car companies that showed sales growth in July, it is not optimistic to calculate the sales so far in 2019. Although FAW-Volkswagen Audi sales rose in July from a year earlier, sales for the whole of 2019 so far are still down 2.3% from a year earlier.

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