New car sales in China slowed in recent months

BOFIT Viikkokatsaus / BOFIT Weekly Review 2015/36

According to the China Association of Automobile Manufacturers (CAAM), sales of new cars were down on year in the June-July period. Overall, the pace of car sales was unchanged in the first seven months of this year. Car sales in the January-July period amounted to 13.4 million vehicles. A total of 23.5 million new cars were sold last year, an increase of 7 % from 2013. Cities are increasingly limiting the number of new car registrations to rein in pollution and traffic jams.

Sales of domestic makes increased in January-July by 14 % y-o-y. In the same period, sales of Japanese makes were up 5 %, while German makes were down 6 % and US makes down 3 %.

Sales of electric and hybrid cars have risen rapidly. Over 90,000 electrics and hybrids were sold in the first seven months of the year. While this was a relatively small share of car sales overall, it was more than triple the number of such cars sold in January-July 2014. Purchasers of electric vehicles enjoy price incentives, tax breaks, as well as registration preference over other cars in cities.

CAAM figures show that 13.6 million cars were built in China in January-July, which was 100,000 more cars than a year earlier. China also imported 530,000 new cars and exported 400,000 new cars in the first half.

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