Car sales in China plummeted 80 percent last month as the coronavirus epidemic stopped people from going to dealerships, according to reports on Wednesday (March 4).
The decline by the world’s largest auto market is expected to be the steepest drop of the year, the China Passenger Car Association (CPCA) said. China sold more than 21 million vehicles last year.
China’s car industry was already in a two-year slump before by the virus outbreak. In March, dealership deliveries are anticipated to drop about 75 percent, which will result in a 40 percent drop in the first two months of 2020, the association said.
“Dealers returned to work gradually in the first three weeks of February and their showroom traffic is very low,” CPCA told Reuters.
To address the plummeting sales Chinese carmaker Geely — which owns black cab maker The London Electric Vehicle Company and Volvo — is joining Tesla, BMW and Mercedes-Benz in test-driving a new online service to kickstart sales in the country.
The car can be driven directly to a customer’s home for a test drive. Geely calls it a “contactless” vehicle purchasing service.
Toyota, China’s largest foreign car maker, said it sold 23,800 Toyota and premium Lexus cars last month, down 70 percent from a year earlier.
China’s second-biggest foreign automaker, GM, said the Chinese auto industry will face “serious challenges” in the first quarter 2020, but is confident sales will perk up in the second quarter, Matt Tsien, president of China GM, said in a WeChat post on GM’s official account.
Cui Dongshu, CPCA secretary-general, told Bloomberg that possible remedies include a reduction in the car-purchase tax of 10 percent and reducing “congestion-related purchase bans.” Incentives could also be implemented to encourage rural residents to buy new-energy vehicles.
Automotive sales are increasingly going digital — and more consumers are buying more used products of all types online. Retail grows via various trends, and right now, both automotive and the sale of second-hand goods online are providing fuel for growth and innovation.