China car sales in June rise for the first time in over a year due to discounts, association says

Retail sales of sedans, sport utility vehicles, minivans and multipurpose vehicles rose 4.9 per cent to 1.8 million units in June from a year earlier

Prices cut by as much as 50 per cent, according to local media reports, to clear inventories of cars that do not meet new stricter emission standards

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Published: 7:10pm, 8 Jul 2019Updated: 5:14pm, 15 Jul 2019

China’s car sales showed signs of recovery in June with a first increase since May 2018 as dealers offered discounts to clear inventory before the implementation of new emissions rules.

Retail sales of sedans, sport utility vehicles, minivans and multipurpose vehicles rose 4.9 per cent to 1.8 million units in June from a year earlier in the world’s biggest market, according to preliminary numbers from the China Passenger Car Association on Monday.

The report offers some hope for car makers and dealers struggling with the first slump in demand in a generation, caused by slowing economic growth, rising trade tensions and stricter emissions rules.

But a sustained recovery is far from certain, with researcher LMC Automotive in June estimating a decline of about 5 per cent for the full year.

A total of 18 provinces and regions – which together account for most of China’s car sales – required vehicles to meet the new emission standards by July 1. Photo: EPA

While the June data is “inspiring,” it is inflated by discounting and it will not be easy for the market to keep up the growth, said Cui Dongshu, secretary general of Passenger Car Association.