The discrepancy between China’s rocketing car sales and its limp gasoline sales has developed into a great conspiracy theory.
The China bears argue that an 80pc rise, roughly, in car sales doesn’t square with a mere 10pc to 15pc rise in the amount of gasoline being pumped.
They say the government is secretly buying cars to prop up the economy and leaving them to rust in warehouses, a prime example of China’s overcapacity and imminent demise.
It is a persuasive idea. After all, China’s local governments do place large fleet orders, and there are severe doubts over the ability of Chinese consumers to rapidly increase their buying. Certainly the factories in Guangdong aren’t counting on domestic buyers anytime soon – they are still praying for an improvement in the export market.
However, Stephen Green, an economist at Standard Chartered, believes that there are other reasons for the discrepancy. "We think people really are buying the cars, but that they are buying more fuel-efficient cars and that high gas prices are causing them to drive less," he writes in a note today.
His first point is that the number of cars on the roads has been exaggerated. Passenger car sales were up 42pc between January and September, but you then have to strip out the bangers being written off, and that the real figure is closer to a 24pc rise.
Then he notes that the charts of gasoline sales and car sales do not match. Some years, gas sales rocket and car sales are flat, and vice versa.
He points to the fact that cars with engines under 1.6 litres have been the fastest-selling models this year, while the cars being retired are likely to be larger. Then there was a slowdown in freight traffic and a probable increase in the use of small trucks to transport goods.
Finally he runs into drivers parking their cars in the Beijing suburbs and taking the bus home because of the high cost of gas. Although many Chinese have managed to scrape together enough money for a car, the running cost is simply too high. On average, gas prices have risen 14pc each year for nine years now.
His final nail in the conspiracy coffin? "We scoured for local reports about this [warehousing] happening in some distant city. We could not find a single report".