Geely cars await sale at a store in Nanjing, Jiangsu province. (Photo provided to China Daily)
Slowing macroeconomic growth and trade frictions blamed for poor performance
China sold 28.08 million cars last year, down 2.76 percent from 2017, marking the first fall since 1990 in the world's largest auto market－and the prospects will be no better this year, said officials of the country's leading industry association.
The lackluster performance was a result of falls over six months in a row since July, ending with a deep slump of 13 percent in December, according to statistics from the China Association of Automobile Manufacturers released last Monday.
Chen Shihua, an assistant to the CAAM's secretary-general, said the sales were lower than expected because of a number of factors, including a fall in macroeconomic growth, Sino-US trade frictions and lower customer confidence.
Passenger cars, accounting for the majority of vehicle sales, saw a deeper fall last year of 4.08 percent. Deliveries stood at 23.71 million units in the country.
Sedans and SUVs sold 11.53 million and 9.99 million units respectively, a slight decline of 2.7 percent and 2.52 percent year-on-year. MPVs and crossovers slumped 16.22 percent and 17.26 percent to 1.73 million and 452,600 units respectively.
Many Chinese auto brands suffered and failed to meet their annual sales targets.
Xu Haidong, another assistant to the CAAM's secretary-general, said the market saw a pattern of rising premium car sales and a slump in low-end SUV deliveries, which seriously affected Chinese SUV makers.
Changan Automobile sold 2.14 million cars last year, a decline of 25.58 percent year-on-year. All Changan subsidiaries have shown negative growth, especially Changan Ford, which saw the highest year-on-year drop of 54.38 percent.
Shi Jianhua, deputy secretary-general of CAAM said some Chinese brands who used their competitiveness to sell their products set a good example under such a downturn.
As one of the most popular Chinese auto brands, Geely's whole year sales reached 1.5 million in 2018, an increase of 20.3 percent year-on-year. Although the carmaker didn't meet the sales target of 1.58 million, it had good performance compared with other Chinese brands.
SAIC Motor Corp, the best-seller of Chinese passenger cars for 14 years, saw slight year-on-year sales growth of 1.8 percent in 2018 to 7.05 million units.
According to CAAM, the market share of Chinese brands has dropped. Last year, a total of 9.98 million passenger cars of Chinese brands were sold, a decline of 7.99 percent year-on-year.
The sales accounts for 42.09 percent of total passenger car sales, which dropped 1.79 percentage points compared with 2017.
This year, the Chinese brands still face challenges and fiercer competition considering the macroeconomic changes, impact of policy changes and rising house prices, the organization said.
CAAM forecast the auto market will not rebound but stay flat with 28.1 million units, containing 23.7 million passenger cars and 4.4 million commercial vehicles.
Despite being a small part of the whole industry, commercial vehicles had a good performance and reached a new high in 2018. Whole year sales increased 5.05 percent year-on-year to 4.37 million.
In addition, new energy vehicles sales are cruising at a high speed. That sector, which consists of pure electric cars and plug-in hybrids, reached sales of 1.26 million last year, up 61.74 percent compared with 2017, including 225,000 units sold in December. According to CAAM statistics, pure electric cars sold 983,700, up 50.83 percent from 2017, and plug-in hybrids soared 118 percent year-on-year to 270,900 units in 2018.
Shi said the reason for the huge increase of plug-in hybrid sales was that they meet the demands of customers.
"Plug-in hybrids can not only save energy and reduce emission, but also relieve customers' concerns about limited driving range and charging points," he added.
