China's car demand falls to lowest level since December
Measure falls to lowest level in four months on buyer concerns over higher petrol prices
Demand for cars in mainland China suffered its first fall in four months to the lowest level since December, according to MNI, a financial news provider wholly owned by Deutsche Borse, the German stock exchange.
China is the world's biggest car market, with the number of vehicles sold rising 6.9 per cent to 23 million last year, from 13.9 per cent in 2013, according to the China Association of Automobile Manufacturers (CAAM).
MNI's Car Purchase Indicator, a pointer to future demand for cars, fell to 86.3 in April from 87.6 in March, the first fall in four months and the lowest reading since December, said MNI. "Car buying sentiment has fallen significantly from a year ago when it stood at 92.5," it said.
The Car Purchase Indicator is made up of two components: Car Purchase Expectations and Price of Gasoline Expectations. A reading below 100 indicates the percentage of pessimists outnumber optimists. In China, the Car Purchase Indicator is based on at least 1,000 phone interviews conducted every month in 30 cities.
Sentiment has remained below 90 for 11 months in a row, MNI said. "This negativity has been driven by continued high expectations for the price of gasoline."
Between March and April, fewer respondents said they expected lower prices of petrol. The proportion of those planning to buy a first car plunged in April to the lowest since July 2014.
"The small fall in the Car Purchase Indicator was driven by a decline in the percentage of respondents reporting it was a good or excellent time to buy a car. Among those who said it was a bad time to buy a car, most cited prices as the key factor," MNI said.
In April, 29.2 per cent of Chinese respondents said their budget to buy a car was between 100,000 and 140,000 yuan, broadly in the mid-range. This was little changed from March, but substantially down from 43.9 per cent in February.
