World's largest car market continues to suffer a serious wobble
The world’s car-makers have a problem. Having bet big on China’s car market to keep rolling on, it has instead fallen for the seventh month in a row.
The world’s largest car market saw its January sales stumble 15.8 per cent from 2018 to 2019, which has established players tightening their belts and relative newcomers trembling.
China’s Association of Automobile Manufacturers (CAAM) confirmed its January volume dropped to 2.37 million cars and the big fall in January followed a 14 per cent decline in November and a 13 per cent drop in December.
It’s safe to say the days when the Chinese market’s unlimited growth could be relied upon to shore up stagnant European sales and wobbly American volumes are over.
CAAM explained that the decline has been partly a result of the deflation of the country’s growth bubble and fallout from US president Donald Trump’s trade war.
It follows more than 20 years of sustained growth in China, though it can be a fickle market for the unready, as Jaguar Land Rover has discovered with the cost of a $US3.9 billion write-down this year already.
The one ray of light in the Chinese market was New Energy Vehicles (plug-in hybrids, hydrogen fuel-cells and EVs), sales of which rose 140 per cent to 85,700 cars in January.
To stave off the collapse of some of its less prepared local manufacturers (of which there are dozens), the Chinese government has confirmed it will extend its New Energy Vehicle subsidies.