The cool-down of the Chinese auto market continues in May, with an increase of just 1,2% for the total market and 4% for locally produced cars, for a total of just over 1,5 million sales. Year-to-date, 8,6 million vehicles have been sold in China, of which 500.000 imports (not included in the figures below) and 8,1 million locally produced models. The Seasonally Adjusted Annualized Selling Rate (SAAR) for locally produced cars is up to 19,4 million units, from 19,1 million last month. May 2015 had 2 fewer sales days than the same month last year, which explains some of the decline.
The shift towards SUVs and crossovers keeps becoming more apparent, as sales of sedan models were down 10% to just over 900,000 vehicles, while sales of SUVs were up a whopping 44% to almost 460.000 units. MPV sales were up 8% to 140.000 units. The slowdown occurred despite several brands cutting prices of across their line-up, most notably General Motors, Volkswagen, Ford and Hyundai. Despite these cuts, GM saw flat sales at Buick and a decline of 24% at Chevrolet, while Ford was down 8,7% and Hyundai slipped 12%. Volkswagen was also down 12%, as the brand is hurt by its failure to respond quickly to changing consumer preferences, offering just a line-up full of sedans but just one locally produced SUV, while Chinese automakers are launching a handful of new, low-priced SUVs every month.
Even premium brands were not immune to the downward trend in Chinese car sales. [Read more…]