China’s passenger vehicles sales drop YoY to 1.76 million units in August

According to the data from the China Passenger Car Association (CPCA), retail sales of passenger vehicles in China dropped 7.4 per cent to stand at 1.76 million units in August, compared to 1.89 million units in the same period last year. The passenger vehicle category includes sedans, SUV, multi-purpose vehicles (MPV) and mini-vans.

The data separately showed a total sale of sport utility vehicles (SUV) as well, which in August had come in at 716,527 units, down 8.5 per cent from 777, 432 units in the corresponding period last year.

Great Wall Securities noted in a research on Sunday that a rollback of tax breaks, macroeconomic slowdown, and Sino-US trade dispute could be some of the factors responsible for this year's poor car consumption.

According to the China Association of Automobile Manufacturers, China passenger vehicles market had shrunk 5.3 per cent in July from a year earlier, the first recession in the past 10 years.

Auto Business Review suggests that SUVs sales plunge reflects a general weakening of consumption, as the sector is susceptible to the economic environment. Besides, market share being already close to the peak and no rollout of a new model in a long time could be some of the other reasons attributed to the drop in sales.

However, in contrast, the global auto sales are likely to increase 1.8 per cent year-on-year, far behind more than 5 percent annual growth since 2010, as predicted by Consultancy LMC Automotive and reported by financial news outlet Wallstreetcn.