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China Vehicle Sales Crash in April But EVs Charge Ahead

Fourteen of China’s top 15 carmakers reported sales losses last month while EV firm BYD’s April sales surged 138.4%


Shanghai auto Covid impact
New cars at a parking lot in Shenyang, Liaoning province, China. Photo: Reuters

 

China’s retail vehicle sales plunged to their lowest monthly point in more than two years in April, down almost a third from the 1.58 million sold in March, according to China Passenger Car Association (CPCA) data.

Fourteen of the country’s top 15 bestselling carmakers last month reported sales losses, as close to just 1 million vehicles were sold, with Shanghai Automobile Industry Corp’s (SAIC) joint ventures with Volkswagen and General Motors posting the steepest year-on-year slumps, of 52.4% and 57% to just 52,178 and 50,121 respectively. 

SAIC-VW and SAIC-GM, usually ranked among China’s top three bestselling automakers, slipped to eighth and ninth in April’s sales rankings.

 

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April saw China’s worst Covid-19 flare-up in two years, shutting major production hubs and hitting supply chains – and jolting auto production and sales off course. The lockdowns in Shanghai and Changchun saw SAIC and FAW-VW suffer their worst month on record. 

Manufacturers based elsewhere, such as Dongfeng-Nissan, Geely, Changan and Great Wall, also saw their sales decline by at least 40% year-on-year.

“The overall sales contraction in the first four months of 2022, compared with a year ago, has widened to 800,000 cars,” said CPCA deputy president Yang Hua. “We are almost in the same [sales] trough as February 2020 when Covid first erupted nationwide and decimated sales.”

He added preliminary sales figures for the five-day Labour Day break “showed some improvement” but were still way off from the sales of a year ago.

Electric vehicle players, though, didn’t suffer as much as legacy carmakers, even if April’s lockdown impact coincided with rocketing input costs. BYD’s April sales defied all headwinds and surged 138.4% to 104,770, seeing them outselling all other carmakers.

Overall, China’s total EV retail sales for April were 282,000, up more than 78% year-on-year, representing a combined market share of 27.1%. But other than BYD, only four manufacturers – Wuling (27,431), Cherry (15,052), Geely (13,036) and GAIC (12,813) – managed to sell more than 10,000 EVs last month.

 

XPeng Unscathed by Covid Lockdowns

There was also a divergence between EV firms clustered in and around Shanghai and those located elsewhere.

Production at Nio and Li Auto’s plants in eastern China was hammered by Shanghai’s lockdown, with April sales dipping to 5,074 and 4,167 – and both failed to make it into the top 10 EV sales list for April. 

XPeng, by comparison, emerged almost unscathed and sold 9,002 EVs because it assembles its vehicles in the southern Guangdong province and sources most of its parts locally.

Carmakers and the CPCA are calling for aid, complaining China’s renewed fight against Covid has left the auto sector in the lurch.

“To keep total sales on the 5% annual growth trajectory in 2022, we must reverse the decline and sell 100,000 additional cars every month in the remaining eight months of the year,” said CPCA’s Yang.

Yang said purchase tax reductions and fee waivers could be good tools to claw back lost sales.

 

  • By Frank Chen

 

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Frank Chen

Frank Chen is an Asia Financial correspondent who covers China business and finance with a special focus on market indexes. He has a keen interest in real estate, transport, infrastructure and consumer brands. He spends time in Shanghai and Hong Kong and speaks Mandarin, Cantonese, and English.

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