China’s auto sale growth hits bump

Weak economy takes toll on largest car market.

SHANGHAI: China’s auto sales rose merely 2.5% year-on-year in September this year, the slowest growth for any month, according to an industry group.

As a weak economy took a toll on the world’s largest car market, total sales hit 1.98 million vehicles for the month, said the China Association of Automobile Manufacturers in a statement.

In August, auto sales reached 1.72 million vehicles, a year-on-year rise of 4%.

Although the group cited rising seasonal demand from the traditionally slow summer months, it added that the year-on-year growth in September was “relatively low”.

Passenger car sales alone rose 6.4% to 1.70 million vehicles in September.

For the first nine months of the year, sales of vehicles – both passenger and commercial – rose 7% to 17.0 million units, the association said.

Last year, auto sales in China reached 21.98 million vehicles. This was helped by a recovery in Japanese brands which were hit by a political row between Tokyo and Beijing over disputed islands.

China’s economy grew 7.5% year-on-year in the second quarter this year, improving marginally from 7.4% in the first quarter, which actually was the worst and similar to the 7.4% result in July-September 2012.

At the same time, a government crackdown on corruption and an austerity campaign have also hurt the luxury auto segment.

The government has also taken aim at foreign automakers, which dominate the market, for what authorities claim is monopoly actions over prices of parts and complete vehicles, fining some.

Still, US auto giant General Motors (GM) posted its best September ever in China with sales rising 15.2% year-on-year to 319,936 units, according to the company.

Published in The Express Tribune, October 14^th, 2014.

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