August marked another gloomy time for China’s auto industry as car sales dropped for the third straight month, Bloomberg reports.
Sales of personal cars, SUVs, and multipurpose vehicles fell by 7.4% year-on-year to 1.76 million units last month, according to the China Passenger Car Association. This follows July’s 5.4% year-on-year drop and drags down the market’s year-to-date growth to just 0.8%.
This might bring an end to almost thirty years of consistent expansion in the world’s largest auto market. A slowing economy is keeping Chinese consumers from splashing out on large one-off purchases, and the uncertainty from US tariffs on cars and auto parts is adding to the sense of caution.
“Winter is coming [for China’s car market],” said Cui Dongshu of the Association. “Demand for SUVs may continue to slide throughout the year.”
SUVs have been a reliable driver of China’s car sales growth in recent years, but were one of the vehicle types hit hardest in August, dropping 8.5% y/y.
“China is heading into a period of slower growth,” said Steve Man, an auto industry analyst at Bloomberg. “The economic uncertainties are likely to keep car buyers on the sidelines.”