China’s VIA in July climbs month on month as market demand overdrawn in June

The vehicle inventory alert index (VIA) in July was at 62.2%, a year-on-year growth of 8.3 percentage points and a month-on-month increase of 11.8% percentage points, according to the China Automobile Dealers Association (CADA). That month, the VIA still exceeded an official warning threshold.

The VIA growth suggests a heavier inventory pressure imposing on car dealers. As of the reason, the CADA said some regions undergoing the transition from China V to VI emission standard in June overdrew market demands, thus dealer inventory pressure was intensified as sales in July evidently declined with car prices picking up.

The association divided regions into four parts geographically—the north, east, west and south, which saw VIA in July reached at 60.3%, 64.0%, 61.9% and 62.6%, up by 6.4, 19.5, 10.1 and 8.6 percentage points respectively over a month ago. The eastern region features the biggest month-over-month VIA growth because provinces included (Anhui, Jiangsu, Shandong, Shanghai, Tianjin and Zhejiang) all implemented the new stricter emission standard as of July 1.

Moreover, the VIA in July for imported & premium brands, mainstream joint-venture brands and China's self-owned brands reached 61.0%, 62.0% and 63.6%, climbing 10.4, 11.4 and 13.5 percentage points respectively from the month-ago period.