After two months of slumping sales in April and May, the Chinese car market recovers with two months of increases in June and July. July sales are up 5,4% on 2016 and a whopping 30,8% on July 2015, which was especially depressed when the Chinese stock market crashed, before the Beijing government stepped in with their tax reduction on vehicles with small engines. A total of 1,65 million new passenger cars were sold last month, naturally a new record for July sales in China. The year-to-date total now stands at 12,59 million sales, an increase of 3,4% on the first seven months of 2016. The Seasonally Adjusted Annualized selling Rate stands at 24 million in July, the highest figure since January. SUVs and crossovers are once again the main (and only) winners in April with sales up 18% to 689.500 units, while sedans decline for the fourth consecutive month at -0,3% to 824.900 sales and MPV sales continue to plunge at -11% to 136.500. New Energy vehicle sales improved 55% to 57.000 units, as EV sales gained 70% to 45.000 units and PHEVs rebounded for the second straight month at +16% to 12.000 sales. Year-to-date, EV and PHEV sales in China are up 22% to 251.000 sales, of which 204.000 EVs (up 34%) and 47.000 PHEVs (down 13%). Sales of domestic automakers were up 9,5% and their share is up from 38% to 39,5%, although that is the lowest share since last January. Japanese brand cars are up 16,3%, sales of US brand cars are up 3,9% and of European brand cars are up 0,9%, while sales of South-Korean brand cars are down 46,7%.
After analyzing the car brand sales ranking for June 2017, let’s take a look at sales figures of individual models. The Volkswagen Golf scores its 14th consecutive monthly loss but remains firmly on top of the ranking. The Renault Clio continues to gravitate at its high level, ahead of the Volkswagen Polo, which maintains a surprisingly high level of sales considering its successor has already been revealed and should arrive soon. We’ve seen similar trends at Audi with the replacements of the A3, A4 and A5, but of course the most extreme example is Volvo with the XC60 first generation which gravitates at record heights in the final months of its career. Despite a loss of 9%, the Opel/Vauxhall Astra is back up to 4th place for the first time since last August ( andup from a horrid 12th place in May) because the Ford Fiesta is down into 9th place as deliveries of the new generation are yet to gain traction. The Opel/Vauxhall Corsa cannot benefit from the Fiesta’s demise as it too is down by more than 20% and out of the top-10. That means the Peugeot 208 is now the #3 best selling subcompact car, but even worse for the Corsa: the Dacia Sandero is only just over 400 sales behind, compared to a gap of over 10.000 sales a year ago. The Citroën C3 isn’t far behind these two either.
The Renault Captur is once again the best selling crossover in a record 5th place for the nameplate, despite a 6% loss on last year. The Nissan Qashqai is stable and keeps its place ahead of the Volkswagen Tiguan, even though the latter shows a massive 45,6% increase on its predecessor last year. After a horrid 20th place in May, the Ford Focus is back into the top-10 and is the best selling Ford since February 2012. The Renault Megane is finally climbing up the charts to #15 even though it loses 1,1% on last year. For the first time this year the Fiat 500 beats its platform sibling Panda for 2 months in a row. And for the first time since shortly after its launch, the Peugeot 2008 (#19) is outsold by the Peugeot 3008 (#18). The latter is a homerun for the French brand, as it’s only 2.000 sales behind the Tiguan (#14) and firmly in 3rd place of its segment. The Volkswagen Passat (#23) continues to sink down the ranking and is now only 13 sales ahead of the Mercedes-Benz C-Class (#24), although the latter also includes the coupe and convertible versions. The Fiat Tipo (#26) has a third month of 15.000+ sales in the last four, and is closing in quickly on the Peugeot 308 (#25). [Read more…]
In the first six months of 2017, Chinese car sales are up just 3% to 10,93 million. If the market maintains this growth rate, it will become the lowest increase in more than 13 years and possibly in more than 25 years. And there’s reason to believe it will come to that scenario, if you look at the sales curve in the second half of 2016, with increasing sales in the last quarter due to a pending increase in sales tax on cars with engines smaller than 1,6 liters, from 5% to 7,5%. Then again, that same tax will rise again in 2018 to 10%, so sales may show a similar curve in Q4 of 2017 as consumers pull forward their buying decisions to benefit from the lower tax. Back to the first half of 2017, in which crossovers and SUVs gained 14,9% to 4,41 million sales, while sedan sales were down 2,5% to 5,42 million and MPV sales slumped 9,4% to 1,09 million. Of these 10,9 million total passenger car sales, 42,3% came from domestic brands and 57,7% from import brands, compared to a ratio of 41,3% vs. 58,7% in all of 2016, as sales of foreign brand vehicles have slightly dipped while sales of local brands have continued to rise, especially thanks to the introduction of a range of afFordable crossovers by almost every single brand.
But that doesn’t paint the complete picture, as European brand sales have remained virtually stable at +0,85% and US brand sales have improved only slightly better than the overall market at +3,86%. The big shift has taken place between Japanese brands and South-Korean brands, as the former are finally starting to recover from their troubles during a diplomatic spat between China and Japan in 2012 over a few islands in the East China Sea, even though only Honda and Mitsubishi have returned to the market share they held in 2011. Still, Japanese brands have grown at a pace of +16,36%, double the gains of the domestic brands, while Korean brands were the only nation to lose volume at a terrifying -46,7%. The reason for that demise has been explained in our monthly reports for the last four months, but there’s another underlying reason which has been going on for a longer period. The South-Korean brands never achieved the kind of mainstream status in China as they did in Europe or North America. They remained a low-cost, low quality option for customers who wanted an import-brand vehicle without having to pay the premium for an actual established brand from Europe, the US or Japan. When the domestic brands started to improve their quality and subsequently their brand image, and also started launching a huge number of afFordable crossovers to satisfy the demand for this type of vehicle, the Koreans were left behind as customers proved less brand loyal than expected. Especially Hyundai has been left behind in this race as its partner Beijing Automotive keeps on expanding the brand’s sedan range to no less than 9 models of different generations sold alongside each other with a 10th nameplate coming up, compared to just 4 crossovers. When recovering from the anti South-Korean sentiment, both brands need to be quick to launch afFordable crossovers to the Chinese market or risk facing reduced market shares for years to come.
After two months of small declines, the Chinese car market returns to a modest growth with sales up 3,2% to just under 1,79 million units. However, there have been reports that the June sales figures are artificially boosted by heavy discounts as 2017 sales threatened to lag behind 2016. Again, crossovers and SUVs are the only type of vehicle to improve year-over-year, with a 16% increase to 741.400 sales. Meanwhile, sedan sales were down 4,3% to 883.000 and MPV sales dropped 3,7% to 163.700 units. Within those sales figures, electric cars and PHEVs also showed a nice improvement of 33% in June to 59.000 units, of which 48.000 EVs and 11.000 PHEVs. For the first six months, sales of New Energy Vehicles totaled 195.000 (160.000 EV and 35.000 PHEV), an improvement of 14% due to a slow first quarter when the government reduced tax incentives on this type of vehicle. New Energy Vehicle sales represented less than 1,5 percent of China’s total new-vehicle volume in the first six months, but the Beijing government holds on to its target of 6,7% in 2020 and as much as 20% by 2025, helped by a carbon credit scheme that will be imposed in 2018.
The Seasonally Adjusted Annualized selling Rate in June stood at 23,2 million, up from the last two months and the third-highest figure of the year so far. The share of domestic automakers was similar to that of May at 40% as all the growth in the market came from domestic brands while sales of import brand cars were stable. Year-to-date, the share of domestic brands now stands at 42,25%. First half car sales in China now total just over 10,9 million units, an increase of 3% on the first half of 2016. However, average transaction prices dropped 4% over the first half of 2017.
After looking at the May 2017 car brand ranking in Europe, let’s discuss sales figures of individual models. The first thing to notice is that the market leader Volkswagen Golf scores its first single-digit loss since last January, after 3 months with double digit losses of which April was the worst with a decline of 28,3% (or almost 14.000 sales less than April 2016), although it must have hurt more that the Golf was outsold by the Ford Fiesta in March. The facelifted version is now fully available and VW’s compact hatchback (and station wagon) can continue its dominance of the European car sales charts. In May its smaller sibling Polo was in 2nd place, just ahead of the Renault Clio, both above 30.000 sales for the second time this year. The Polo will be facelifted later this year, the Clio has just been freshened. Meanwhile, the new generation Fiesta is just entering dealerships across Europe and should start to make an impact later this year. For now the Fiesta is stuck in 4th place, ahead of the Opel/Vauxhall Corsa, the biggest loser in the top-10 at -8,2%. [Read more…]
Car sales in China seem to have stalled after years of double digit growth. The main culprit for the slowdown has been mentioned on these pages before: the government has artificially boosted demand for cars with small engines since the 3rd quarter of 2015 when the market threatened to sink into the red due to a collapsing stock market and reduced customer confidence. That tax break has worked perfectly in pulling forward car purchases in Q4 of 2015 and in 2016 but it was cut in half by the beginning of 2017 and has since affected the Chinese car market in a negative way. Sales of vehicles with engines of 1,6 liters or less fell 9% to 1.15 million last month. In Q1, total market sales were still up by 5,7% but two months of declines have brought the year-to-date tally to 9,25 million, up just 2,7% on the first 5 months of 2016. A 2,2% loss in April was a first warning sign and now in May sales are down by another 2,1% to 1,71 million units. The Seasonally Adjusted Annualized selling Rate rebounded to 22,2 million, still the second lowest figure in the past 12 months. SUVs and crossovers continued to fuel the market with sales up 13% to 715.000 units in May, but this could not offset declines in deliveries of sedans (-9,3% to 839.000 sales) and MPVs (-17% to 150.000). The share of domestic automakers was the lowest since last August at 40,3% and it has fallen hard since its peak of 47,1% in February. However, compared to May 2016, the domestic brands have increased their sales 3% while the foreign brands saw their volume shrink by 5,5%. Year-to-date, the domestic share is now 43,4%.
After discussing the April 2017 European car brand sales ranking, let’s take a closer look at which individual models are helping their brand succeed or fail. After the freak event in March, when the Volkswagen Golf was not the best selling car in Europe, things have returned to normal in April, although the Golf is still the biggest loser by far in the top-25 wiht a loss of more than 28% on last year. The Golf lost more sales from April 2016 to April 2017 than its rival Renault Megane sold last month (Golf: -13.831 units). And while the Golf no longer sells double the volume of its nearest competitor, it still has a gap of almost 10.000 sales to the #2, as the entire top-3 is down. One culprit for the Golf’s demise is obvious in 4th place: the success of the Volkswagen Tiguan, up 70% to equal its highest ranking ever. Last month’s leader Ford Fiesta is down to 7th place as it’s payback time for its dependence on the UK market, which was exceptionally strong in March, but exceptionally weak in April. The same can be said of the Opel/Vauxhall Corsa, down 15% into 8th place. We welcome the Citroën C3 into the top-10 for the first time ever, as it even threatens to outsell its recently acquired stablemate Corsa. The Skoda Octavia is back into the top-10 which means there’s only one crossover in the top-10, as the Nissan Qashqai and Renault Captur are both just outside. The Captur is down 14% but remains ahead of its rivals Peugeot 2008 (#14) and Opel/Vauxhall Mokka X (#25), which are both down by single digits as competition in the segment has intensified by the arrival of new players. [Read more…]
The Chinese car market is fluctuating in the first four months of 2017: After a stable January, a promising 20% gain in February 2017 and a modest growth of 2,9% in March, April sales are down 2,2% again, for a total of 1,68 million units. Of course, this is still the second-best ever April figure, and the YTD total now stands at 7,54 million, an increase of 3,8% on the first four months of 2016. The Seasonally Adjusted Annualized selling Rate stands at 21,4 million in April, the lowest figure in the past 12 months. Sales of vehicles with engines of 1,6 liters or less fell 10% to 1.14 million, after the central government phased out a tax break on these models at the beginning of this year. SUVs and crossovers are once again the main (and only) winners in April with sales up 10% to 674.000 units, while sedans sales decline for the second consecutive month at -7,3% to 840.000 sales and MPVs lose volume for the fourth month in a row at -15% to 153.000. New Engergy vehicle sales improved 7,9% to 34.300 units, as EV sales gained 19% to 28.500 units but PHEVs plunged 27% to 5.800 sales. The share of domestic automakers dipped below 42% for the first time since last August as they benefitted the most from the tax cut on small vehicles.
Shock and horror at the top of the European car sales ranking: in March 2017 the Volkswagen Golf is not the best selling car in Europe, for the first time since at least 2011 (our monthly data only goes back to 2012) but likely since March 2010. The Ford Fiesta leads the ranking despite being due for replacement by the next generation, which has already been revealed. This is the result of two factors: firstly the Fiesta is boosted by its strength in the UK market, where it’s traditionally been the best seller, and which is traditionally the largest market in Europe in March, and secondly, the Golf is struggling after its recent facelift with sales down 18%, due to increased choice of in-house crossover alternatives with the new generation Tiguan and Seat Ateca. Still, this won’t be the beginning of the end of Golf domination, expect the model to continue to lead the charts for the rest of the year as it usually does. The Volkswagen Polo is third again, which means it outsells the Renault Clio for the first time since last October. For the second month in a row the Nissan Qashqai is the best selling crossover in Europe, also helped by its popularity in the UK where it’s produced. [Read more…]
After a stable January, and a promising 20,2% gain in February 2017, March car sales in China are back to modest growth with a 2,9% increase to just over 2 million units. To put that small year-on-year growth into perspective: March 2012 sales just topped the 1 million units, so the market has doubled in 5 years time. In that light, a 3% improvement is quite a slowdown. Then again, first quarter sales are up 6% to 5,78 million and that’s on par with expectations, as sales growth was expected to slow down into the single digits after the tax increase on cars with engines of 1,6 liters or smaller, which made up over 70% of total sales last year. The Seasonally Adjusted Annualized selling Rate stands at 23,5 million in March. SUVs and crossovers are the main (and only) winners in March with sales up 20% to 832.300 units, while sedans surprisingly show a loss of 4,9% to 990.200 sales (first quarter sales are up just 0,8%), and MPVs lose volume for the third month in a row at -15% to 199.300. The central government cut EV subsidies last January but when sales plummeted to almost a halt that month, the subsidies were quickly reinstated, and as a result Sales of New Energy vehicles (EVs and PHEVs) jumped 36% in March to 25.342 EVs and 5.778 PHEVs, but the Q1 figure is still down 4,7% to 44.333 EVs and 11.596 PHEVs. After domestic brands broke a new record share of 46,5% in February, foreign automakers struck back in March with their locally produced models as the share of the domestics dropped to 43,6%. [Read more…]