Decline in electric, hybrid car sales hurt China auto market

Chinese consumer demand affected by unease over Beijing's tariff war with US President Donald Trump.

    Purchases of electric and hybrid cars fell 4.7 percent from a year ago to 80,000 units in July [File: Ng Han Guan/AP]
    Purchases of electric and hybrid cars fell 4.7 percent from a year ago to 80,000 units in July [File: Ng Han Guan/AP]

    China's auto sales sank again in July, extending a yearlong contraction in the industry's biggest global market, according to the latest report by the country's car manufacturers.

    Sales of sedans, SUVs and minivans declined 3.9 percent from a year earlier to 1.5 million, the China Association of Automobile Manufacturers said late on Tuesday.

    Sales of electric and hybrid vehicles suffered a rare decline in sales that had risen steadily this year.

    Purchases fell 4.7 percent from a year ago to 80,000 units despite government pressure on automakers to promote the technology.

    Chinese consumer demand has been hurt by unease over Beijing's tariff war with US President Donald Trump and weakening Chinese economic growth.

    The overall auto market last expanded in June 2018 and has recorded declines every month since then, adding to pressure on Beijing to shore up cooling economic growth.

    That is squeezing cash flow for global and Chinese automakers that are spending heavily to meet government targets to sell electric vehicles.

    The government is phasing out subsidies that supported sales and shifting the financial burden to manufacturers, which is raising the total cost to buyers.

    Auto sales for the seven months through July were off 12.8 percent from the same period of 2018 at 11.6 million vehicles, CAAM said in its data released late on Monday.

    SUV sales fell 11.1 percent and sedan sales were off 13.4 percent.

    Sales by Chinese automakers declined 13.3 percent to 553,000 vehicles. They lost 3.9 percentage points of market share to 36.2 percent.

    Total vehicle sales, including trucks and buses, retreated 4.3 percent to 1.8 million.

    SOURCE: AP news agency