Coronavirus: China’s car sales collapse, as officials warn of sharp trade decline to come

China Passenger Car Association said sales fell to just 4,909 units in the first 16 days of February, from 59,930 in the first quarter of 2019

The growth rate for China’s imports and exports is expected to decline sharply in the January-February period

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Commuters make their way along an expressway during rush hour in Beijing. Photo: AP

Published: 6:15pm, 21 Feb 2020Updated: 10:08pm, 21 Feb 2020

A 92 per cent drop in car sales in China in the first half of February provided the first real indicator of the economic impact of the coronavirus epidemic, with officials also warning of a sharp decline in Chinese exports and imports for the first two months of the year.

The China Passenger Car Association (CPCA) on Friday said that sales dropped to just 4,909 units in the first 16 days of the month, down from 59,930 vehicles in the same period a year earlier.

“Very few dealerships opened in the first weeks of February and they have had very little customer traffic,” said the CPCA.

China’s car market is likely to see sales slide more than 10 per cent in the first half of the year due to the outbreak, and around 5 per cent for the whole year, provided the virus is effectively contained before April, the country’s top industry body, the China Association of Automobile Manufacturers (CAAM), said last week.

The sector was already under pressure from the cooling economy, with car sales falling 3 per cent in 2018 in the first sales contraction since the 1990s, and 8.2 per cent in 2019, CAAM said.

“We must firmly believe that China’s auto market still has great development space and potential, and the automobile consumption demand is still strong,” Wang Bin, vice-director of the commerce market operation department at the commerce ministry, said on Thursday.

To stabilise the market, in which more than 25 million vehicles were sold last year, China’s commerce ministry said it will introduce more measures to boost consumption.