The automobile market in China is one of the biggest in the world and has been on that crown position for quite some time now. However, a slump has been recorded in the recent times as the industry recorded a decline of 15.8 % in January 2019, marking a continuity of 7 straight months of a slump which has also raised some concerned eyebrows.
China has been facing harrowing times financially as their trade has taken a hit and their economic growth has acquired a snail’s pace. They also had a recent issue with the United States which resulted in their fallout and affected their financial status. This got excessively reflected in the automobile sector, as according to the report sent by China’s Association of Automobile Manufacturers to the Reuters, January saw the sale of only 2.37 million units. This comes in the wake of December and November 2018 when the drop was 13 % and 14 % respectively.
Beijing has decided to not rest as this decline is taking place and has started urging the consumers to become a little more unrestrictive while spending on automobiles and loosen their purse and make more purchase. They have also pledged to subsidize and reduce the price of vehicles especially the ones which held more utility rurally and also invest more in automobiles that ran on newer energy so that more people purchase them. The fact that the Lunar New Year is coming up could also be a contributing factor for the decreased sales in January and December as most people in China try to hold onto purchasing vehicles around that particular festival.
The date of it is not fixed and varies yearly but generally falls around January and February, making these two a common month of the slump. The only good news rolling in is the fact that the vehicles running in newer energy have continued seeing an increase in growth with 95,700 units sold in January, which marks an increase of almost 140 %.