Posted on 15 Jan 2021
Despite the massive economic disruption caused by the COVID-19 contagion last year, automotive sales across China only declined 1.9% on year in 2020, according to the latest release from the the China Association of Automobile Manufacturers (CAAM) on January 13, and it was in line with the association's latest estimation of a 2% on-year drop at most by in mid-December 2020.
Even though Chinese auto sales for domestic buyers and export still totalled 25.3 million units last year, 2020 nonetheless marked the third year in succession for auto sales to post negative on-year growth. But this year total sales will likely exceed 26 million units, CAAM predicted, making for a healthy increase of 4% on year.
“In general, the performance of the auto industry was much better than expected,” the association acknowledged, a result it attributed to three factors, namely the strong supportive policies of both the central and local governments, the consistent efforts among manufacturers to generate sales, and the substantial recovery of consumption of big-ticket items.
Since April domestic auto sales had been witnessing positive on-year growth. Sales of commercial vehicles including heavy-duty trucks were the first to speed up, which eventually resulted in a huge on-year rise of 18.7%. By contrast, sales of passenger cars were slower to resume after the epidemic’s onslaught and resulted in a decline of 6% on year. However since September, passenger vehicle sales contributed more to the overall growth in sales, the released noted, which indicates recovering demand.
Trucks sales totalled 4.7 million units throughout 2020, higher by 21.7% on year and growing much faster than the average growth of commercial cars sales, according to the data.
Numerous policies were launched by both the central government and local authorities last year to promote car consumption amid the impact of the virus outbreak which began in late January. Measures aimed at stimulating sales of new-energy vehicles (NEVs) were especially strong and proved quite effective, Mysteel Global noted.
NEV sales for the whole of 2020 moved up 10.9% on year to 1.4 million units, the CAAM data showed, which was only 100,000 tonnes short of the 2020 target despite the disruption of the pandemic, and China's central government aims to lift the ratio of NEVs against total auto sales to 25% by 2025.
In late April, Beijing announced it would extend the payment of subsidies towards NEV purchases by another two years to 2022 and in the meantime, maintain the exemption of purchase tax on them also for another two years, as reported.
Other than policies from the central government, local authorities and relevant car manufacturers also cooperated to encourage sales by offering discounts on certain car models, especially in rural markets. In addition, first-tier cities such as Beijing and Shanghai pushed sales of NEVs by issuing more licence plates for these vehicles and by tightening restrictions on conventional internal combustion automobiles.
“From the considerable volume of orders secured by spare parts suppliers to NEVs, we can see strong NEV sales, at least in the first half of this year,” a Shanghai-based market insider said. CAAM expects NEV sales to surge by 40% on year this year.
China's auto industrial performance over 2020 ('000 units)
|
Dec |
Jan-Dec |
|||||||
|
Sales |
YoY (%) |
Production |
YoY (%) |
Sales |
YoY (%) |
Production |
YoY (%) |
|
|
Total |
2,831 |
6.4 |
2,840 |
5.7 |
25,311 |
-1.9 |
25,225 |
-2 |
|
NEVs |
248 |
49.5 |
235 |
55.7 |
1,367 |
10.9 |
1,366 |
7.5 |
Source:Mysteel Global
