China auto sales growth slows in Sept as signs of softening demand emerge
China’s auto sales rose 25.7% in September from a year earlier, a slower pace of growth compared to the previous two months when electric car sales grew at a faster rate because of government incentives.
Auto sales in the world’s biggest car market increased to 2.61 million vehicles last month, data from the China Association of Automobile Manufacturers (CAAM) showed on Tuesday.
While sales were still buoyant compared to the year before, the slower year-on-year growth versus July and August suggests falling demand in a weakening economy. Sales in the first half of the year were impacted by stringent lockdowns in Shanghai and other Chinese cities.
September sales of new energy vehicles (NEV), which include pure electric vehicles (EV), plug-in hybrids and hydrogen fuel-cell vehicles, increased 93.9% from the previous year.
Total auto sales for the first nine months of 2022 rose 4.4% from the same period in 2021.
CAAM tracks broader auto sales including passenger vehicles, buses and trucks. The China Passenger Car Association (CPCA), which focuses on retail sales of cars, said earlier on Tuesday that China’s passenger car sales in September rose 21.2% to 1.95 million.
CPCA said on Sunday that Tesla’s deliveries of China-made EVs in September rose 8% from August, smashing its monthly record.
“The recovery trend is far lower than our expectation. The market is overall relatively weak,” CPCA’s Secretary General Cui Dongshu told reporters on Tuesday, adding that performance was weak at foreign car brands.
“The strict COVID curbs in many cities had prevented people from attending auto shows and promotion events, discouraging sales.”
China has tried to revive demand damped by stringent COVID-19 curbs including a two-month lockdown in its commercial hub of Shanghai. Since June, China has offered incentives such as a lower sales tax for small-engine vehicles and subsidies to spur trade-ins of gasoline vehicles for electric ones.
In August, CAAM said car sales rose by nearly a third from a year earlier, on the back of higher growth in June and July as well. Sales of NEVs doubled in August and rose 120% in July.
In September, China’s vehicle exports increased 73.9% from a year ago, CAAM said and EVs accounted for one-sixth of them.
Chinese automakers are accelerating their moves to sell their EVs abroad, especially in South East Asia and Europe. BYD and Nio both announced plans to bring more models to the European market in recent weeks.
Smaller player Hozon Auto, which opened a showroom in Thailand and delivered its first batch of cars in Nepal in September, said its sales in overseas market would exceed 50,000 units in 2023.
