Retail sales of passenger vehicles in China fell 3% year on year to 1.723m units in July 2024, the fourth consecutive month of decline, according to data released by the China Passenger Vehicle Association (CPCA).
Chinese GDP growth slowed to 4.7% year on year in the second quarter of 2024 from 5.3% in the first quarter, as domestic consumption continued to be affected by the ongoing property crisis in the country. Exports were also being held back by increasing frictions with key trading partners such as the US and the EU.
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Sluggish domestic consumer demand in the last several months prompted the Chinese government to announce additional market stimulus measures at the end of July, including doubling the one off subsidy of CNY10,000 (US$1,390) introduced in April to CNY20,000 for buyers trading in their old internal combustion engine (ICE) vehicles for qualifying new battery electric vehicles (BEVs). The government had previously also taken measures to reduce down payment requirements on vehicle loans.
Retail sales of new energy vehicles (NEVs), including plug in hybrid and electric vehicles, surged 37% to 879,000 units in July to exceed 50% of overall domestic passenger sales for the first time, with a further 103,000 units exported.
In the first seven months of 2024, domestic retail sales of passenger vehicles increased by 2% to 11,568,000 units while NEV sales rose by 34% to 4,991,000 units.
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