China Passenger-Car Sales Gain at Slowest Pace in 6 Months as Demand Wanes
Wholesale deliveries, including sport-utility vehicles and minivans, gained 0.3 percent to 1.34 million units last month, the China Association of Automobile Manufacturers said today in a statement. That compares with the 0.5 percent median estimate of five analysts surveyed by Bloomberg and is the slowest pace since May, when sales dropped 0.1 percent to 1.04 million.
China’s vehicle sales have slowed from last year’s record 32 percent increase as inflation, higher interest rates and the end of a two-year stimulus plan deter purchases. Deliveries for 2011 may rise the least in 13 years, according to the auto industry group, adding to signs China’s economy is slowing.
“Inflation and gasoline prices are high and the outlook is still uncertain,” said Yale Zhang, managing director at industry consultant Autoforesight Shanghai Co. “This has reduced consumers’ will to purchase.”
The auto manufacturers association, which has cut its market forecast twice this year, estimates the number of vehicles delivered to Chinese dealerships will rise between 3 percent and 5 percent in 2011, after surging 32 percent in 2010 on the back of tax breaks and rebates for buyers in rural areas. That would mark the first time the Chinese market expands at a slower pace than U.S. light-vehicle retail sales, based on association figures stretching back to 1998.
Dong Yang, deputy head of the association, said today that China’s vehicle sales will “very likely” grow more than 2 percent this year.
Minivans, popular in rural areas to transport goods and people, fell 9.5 percent last month in China, leading declines in passenger-car deliveries, according to association numbers. That extends this year’s slide to 9.8 percent. Sport-utility vehicle sales gained 21 percent in November.
Including buses and trucks, total sales in China fell 2.4 percent to 1.66 million vehicles last month, according to the association. In the first 11 months of the year, they increased 2.6 percent, with passenger-car deliveries up 5.3 percent to 13.1 million.
Chery Automobile’s car deliveries fell 5.9 percent to 41,600 last month. Toyota Motor Corp. (7203), Japan’s biggest automaker, sold 82,000 vehicles, down 1.3 percent from a year earlier, Niu Yu, the company’s Beijing-based spokesman, said Dec. 6. Tokyo-based rival Honda had a 3.3 percent decline in November sales to 58,228, the company said in a statement the same day.
Ford Motor Co. (F), maker of the Focus compact and Mondeo sedan, said its sales in China fell 7 percent in November to 43,338, led by a 19 percent decline in deliveries at its commercial-vehicle joint venture.
In contrast, General Motors Co. (GM) boosted deliveries in China 20 percent last month to 237,130, the fastest pace in 10 months, helped by minivans made by joint venture SAIC-GM-Wuling Automobile Co.
GM’s Buick Excelle tied with Volkswagen AG (VOW)’s Lavida sedan for the top-selling model last month, with sales of 23,900 units each, according to association data.
Last month’s deceleration in auto sales adds to evidence that the world’s second-largest economy is slowing.
China’s manufacturing contracted last month for the first time since February 2009, according to a government-backed survey of purchasing managers, as the property market cooled and Europe’s crisis cut export demand.
The central bank announced its first reduction in banks’ reserve requirements since 2008 the night before the release of the data. Retail gasoline prices were lowered by as much as 3.3 percent in October, the first cut this year, after four increases since June 2010 boosted prices by about 20 percent, according to the nation’s top economic planner.
“We’re aware of how the world economy is performing,” Olaf Kastner, chief executive officer of Bayerische Motoren Werke AG’s China venture, said in a Dec. 1 interview. “For next year we’re still positive. We might not see the very high growth rate we have enjoyed for the last two to three years, all of us.”
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