China’s New-Car Sales Drop 10%

Wholesales of new passenger vehicles in China dropped 10% to 2.06 million units in June, marking the 12th consecutive monthly decline, according to the China Assn. of Automobile Manufacturers.

CAAM says factory shipments to dealers through the first half of 2019 shrank 12% to 12.32 million units. Full-year sales dropped 3% to 28.1 million passenger vehicles last year.

The trade group predicted in January that wholesales this year would be flat at about 28 million vehicles. But achieving that target now appears unlikely. CAAM concedes that sales promotions have failed to improve market sentiment.

Demand has been disrupted in part by a switch from China V to tougher China VI emission standards this month in some regions. Affected dealers have been focused on reducing inventory rather than loading up on China VI-compliant models.

The China Passenger Car Assn., which represents dealers, says carmakers must lower their sales targets for 2019. The group predicts that retail sales will revive in August.