Employees work on the production line of an automaker in Chengdu, Sichuan province, China. (LI XIANGYU / FOR CHINA DAILY)
Both traditional and new energy vehicles in China may maintain robust growth momentum thanks to supportive policies and market factors, industry experts said.
The world's largest automobile market produced 2.4 million units and sold 2.38 million in August, rising 38.3 percent and 32.1 percent on a yearly basis, respectively, said the China Association of Automobile Manufacturers.
Between January and August, auto output surged 4.8 percent year-on-year to 16.97 million units, while sales rose 1.7 percent to 16.86 million units, said the association.
Purchase tax incentives and other consumption-promoting policies continued to inject vitality into the passenger car market. Even with fluctuations in economic performance, automobile consumption remained resilient and has gradually returned to normal
Chen Shihua, CAAM deputy secretary-general
Chen Shihua, CAAM deputy secretary-general, said: "Purchase tax incentives and other consumption-promoting policies continued to inject vitality into the passenger car market. Even with fluctuations in economic performance, automobile consumption remained resilient and has gradually returned to normal."
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Zhang Xiang, visiting professor of the Engineering Department of Huanghe Science and Technology University, said: "For the automobile market, August is often the start of the traditional high sales season. In addition, the effects of many incentive policies, which were released in May, were gradually realized in the second half of this year."
The State Taxation Administration said that between June and August, a total of 3.55 million units of automobiles enjoyed purchase tax relief of 23 billion yuan (US$3.3 billion).
The administration said that during the three-month period, both the number of vehicles that enjoyed tax breaks and the amount of purchase tax reductions increased month by month. The policies were gradually exerting force, and benefits steadily expanded.
Zhang said that in the first half, due to COVID-19, many residents were under quarantine, and 4S stores－short for Sales, Service, Spare parts and Surveys－in many places were shut down, making it difficult for consumers to leave home and purchase vehicles. In addition, the output value of automobile manufacturers was affected due to the contagion.
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"With the epidemic situation improving, the second half of this year will definitely witness a great increase in automobile sales," he said.
Chen Jia, an independent researcher in international strategy, said: "The recovery in August sustained the growth momentum in the first half of this year. Under the country's policies to ensure stability and promote consumption, NEV subsidies were further optimized, and other national promotional incentives were launched one after another. Plus the fact that automobile makers are gradually breaking production bottlenecks, the supply and sales boom in the country's automobile market is an inevitable trend."
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Chen added: "Amid the backdrop of global industrial chain competition, the resilience of China's automobile industrial chain has been fully proved. For the rest of this year, as long as there are no major external supply chain disturbances restricting production capacity, the automobile consumption market is promising."
Li Fusheng contributed to this story.