China's roller coaster auto industry received more mixed news, with reports of sales picking up tempered by revelations of ballooning car-loan defaults, and then spirits battered further still with news of a fresh slump in sales.
Official statistics for September sparked some hope when sales grew 14.37% from a moderate rise in August. But any optimism was dampened by figures for October which saw a fresh slide in sales, down 7.83% on a month earlier.
Meanwhiles, signs of trouble emerged on the loan front, despite the fact that the car financing sector has barely had time to pass the embryonic stage. A report in the South China Morning Post said that by late October overdue loans had already ballooned to RMB90bn, a situation blamed on aggressive lending, poor credit checks and plain fraud.
According to the paper, the Agricultural Bank of China, which already holds more NPLs than any other bank, is stuck with about half the country's overdue car loans.
An official at the government-backed China Automotive Technology Research Centre said that with car prices collapsing, many consumers decided it was cheaper to buy new cars than pay off old ones.
Financing now accounts for only 10% of car purchases in China, as against 70% to 80% in developed car economies.
According to projections from market leader Volkswagen, which recently launched its own car loans division, car financing will eventually account for half of its China sales.
Elsewhere in the auto industry, domestic manufacturers continued their tentative steps into overseas markets and acquisitions. Chery Automobile, for example, announced it would begin assembling cars in Malaysia with a local partner, and auto industry officials from Anhui said they were in discussions regarding the construction of a car making plant in Pakistan.
The biggest news came from industry giant Shanghai Automotive Industry Corp (SAIC), which signed an MOU with creditors to pay a reported US$522m for a 48.9% stake in South Korea's Ssangyong Motors.
That deal marked the first major overseas acquisition by a Chinese car company and gives China's biggest carmaker the capacity to expand into sport-utility vehicles.