China’s electric vehicle showrooms are sending an ominous signal about the sales outlook this year
- Fewer buyers at electric car dealerships last month following government decision to roll back subsidies in late June
- Government-backed industry consortium revised forecast for new energy vehicle sales this year to 1.5 million units, slashing earlier forecast by 100,000 units
Chinese electric and hybrid vehicles makers are bracing for a downturn, after consumers flocked to showrooms before the government scaled back its subsidy programme designed to promote green vehicles in June.
Analysts said anecdotal evidence points to a downturn in the new-energy vehicle (NEV) segment in July, the first full month of sales since the government’s revised subsidies came into effect.
“Sales are set to slow in the remaining year because those customers keen on owning a NEV car have already bought,” said Shen Wei, an auto analyst with UBS. “The industry had been overly optimistic about the NEV segment earlier.”
New energy vehicles, however, remain a bright spot, having bucked the annual decline in sales weighing on the broader automotive sector, with sales surging 58.7 per cent to 617,000 units in the first six months of the year, according to the China Association of Automobile Manufacturers (CAAM).
Last year, China reported sales of 1.26 million pure electric and plug-in hybrid vehicles, up 61.7 per cent from 2017.
Shen said that fewer buyers were seen visiting electric car dealerships last month, following a surge in vehicle purchases as consumers rushed to beat the June 26 deadline for the subsidy reduction.