China’s NEV Retail Sales Fall 12% in Aug. 1–23 as Auto Market Remains Weak

Data from CPCA showed that passenger-vehicle retail sales reached 956,000 units from Aug. 1–23, down 22% year over year and 2% from the same period in July.

Passenger-vehicle wholesale sales totaled 1.012 million units during the period, down 20% year over year but up 2% from the previous month.

For the year to date, passenger-vehicle retail sales reached 11.129 million units, down 20% year over year, while wholesale sales totaled 15.822 million units, down 6%.

The NEV market performed somewhat better than the overall passenger-car market, although retail demand remained weak.

NEV passenger-car retail sales totaled 614,000 units from Aug. 1–23, down 12% year over year and 2% month over month. NEVs accounted for 64.3% of total passenger-vehicle retail sales.

NEV wholesale sales, meanwhile, reached 714,000 units, up 5% year over year and 4% month over month.

The wholesale penetration rate reached 70.5%, remaining above 70% for the fourth consecutive week.

The gap between wholesale and retail volumes also suggests that exports continue to offset some of the weakness in domestic retail demand.

For the year to date, NEV passenger-car retail sales reached 6.283 million units, down 12% year over year, while wholesale sales rose 7% to 8.962 million units.

On the production side, output of conventional gasoline-powered light vehicles reached 270,000 units in the first three weeks of August, down 59% year over year.

Production of hybrid and plug-in hybrid models totaled 259,000 units, down 20%.

The shift in production mix shows that NEVs continue to squeeze the market space occupied by conventional internal-combustion vehicles.

After mid-August, showroom traffic began to recover from the subdued levels seen at the start of the month.

Some previously delayed purchase demand began to be released, while the Chengdu Auto Show, which opens in the second half of August, has also lifted market activity with a wave of new-model launches and pre-sales.

However, consumer expectations and broader market fundamentals have yet to show a significant improvement, leaving the auto market at a low level with sales still down more than 20%.

A CPCA survey found that major automakers, which account for more than 70% of total market sales, are targeting an average 8% month-over-month increase in retail sales in August, broadly in line with seasonal patterns in previous years.

The CPCA expects China’s narrow-definition passenger-car retail market to reach about 1.58 million units in August, up 8.1% month over month but down 21.7% year over year.

NEV passenger-car retail sales are projected at around 1.04 million units, with the NEV penetration rate potentially reaching 65.8%.