China’s struggling automotive industry continued to skid to a halt in January, as car sales fell for the seventh straight month at the start of the year.
Sales dropped 15.8 per cent year-on-year 2.37m cars for January – more than 13 per cent in December and 14 per cent in November.
In a statement sent to Reuters, assistant secretary general of the Chinese Association of Automobile Manufacturers (CAAM) Xu Haidon said: “Car sales in January continued to decline, and there was no sign of improvement. We estimate that February wholesales will also drop sharply.”
“The reason for the sales drop is still the slowing overall economy, and consumption decline in small- and medium-sized cities,” he said.
The slowdown in China’s car industry has hit European manufacturers hard, with several struggling to turn a profit in 2018. Most recently, Jaguar Land Rover reported its Chinese sales fell 40 per cent in the final quarter of last year.
China has long played a key role in growing profits for global manufacturers, and European car makers' shares fell slightly this morning, with Volkswagen dropping 1.2 per cent, Mercedes-owner Daimler down 0.5 per cent, Renault down 1.4 per cent and BMW down 0.3 per cent.
China’s economy grew at its slowest rate since 1990 in 2018 as demand lessened and trade tariffs imposed by the US continued to bite.
GDP growth eased to 6.4 per cent from 6.5 per cent in the third quarter, dragging full-year growth to 6.6 per cent, the slowest annual rate in nearly three decades.