China’s auto sales likely to fall 10% in 2019, CAAM

Yao Jie, vice secretary general of the China Association of Automobile Manufacturers (CAAM), expected China’s automobile sales in 2019 to decline around 10% amid the downturn trend since July, 2018.

The 2018 China’s auto market recorded its first-time sales downturn in nearly thirty years with 28.08 million units sold. The association estimated in early 2019 the annual auto sales at 28.10 million units, basically flat to the 2018 level. However, as of this October, the world biggest auto market saw year-on-year sales fall for 16 consecutive months. According to CAAM, in the first ten months of 2019, the sales slid 9.7% year on year to 20.65 million units.

Many other auto markets around the world have also posted decrease in sales. The International Organization of Motor Vehicle Manufacturers (OICA) forecasted a global auto sales drop of roughly 3.10 million units in 2019. To alleviate the market pressure, a number of mainstream automakers have been taking measures, such as reducing operating costs and fixed asset investment and developing electrification and digitization for a long-term development.

However, the market pressure will bring new chances and challenges to China’s auto industry. Xu Haidong, assistant to the secretary general of CAAM, reckoned 2019 is a crucial time for the industry and it will not be helpful for automakers to still depend on economic models. China’s indigenous brands are going to compete with joint-venture ones in a head-on and comprehensive way.