Beijing - A sales hangover and
holiday-shortened month combined to send China’s passenger-vehicle sales
to their first decline in almost a year, with sedan deliveries bearing
the brunt of the slump.
9.8% last month to 2.12 million units in January, the first
decline since February of last year, according to the China Passenger
The week-long Lunar New Year holiday, which started on
January 27 this year, also crimped demand. Showroom traffic slowed last
month after consumers bought passenger vehicles at the fastest pace in
three years in 2016 to take advantage of a tax cut on small-engine
automobiles before it was scaled back.
Demand for sedans waned, weighing on deliveries at Toyota and Nissan. New sport utility vehicle models bolstered demand
Geely Automobile and Guangzhou Automobile, with
both Chinese carmakers reporting more than 28% gain in
There were five fewer selling days in January because of the Lunar
New Year, resulting in a loss of about 15% of monthly sales,
according to the association. The usual surge in car purchases after
companies distribute the year-end bonuses also didn’t happen, while
consumers advancing purchases to beat the tax increase also damped
demand, the group said.
Deliveries for sport utility vehicles rose 6.9%, the only
passenger-vehicle category to post an increase, while sedan sales fell
18%. Demand for light-commercial vehicles, which are also used as
passenger vehicles, plunged 28%.
This year may turn out to be a year of reckoning for automakers with
the state-backed auto association forecasting a
slowdown in sales growth to 5% from 13.7% in 2016. After
halving the sales tax on small-engine cars to 5% to boost sales,
the government raised the levy to 7.5% from the start of the
Geely increased 71% in January, led by its Boyue sport utility
vehicle. While overall sales of SAIC rose 0.3%,
deliveries of its self-owned brands including Roewe and Morris Garages
soared 71% last month.
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