Auto sales in China recorded a 12th successive month of gains in March, soaring past pre-pandemic levels.
According to data from the China Association of Automobile Manufacturers (CAAM), sales of autos in the world’s biggest car market reached 2.53 million vehicles in March, up 74.9% year-on-year.
The 12th consecutive month of gains was fueled by sales of new energy vehicles (NEVs), including battery-powered electric vehicles, plug-in petrol-electric hybrids, and hydrogen fuel-cell vehicles. This sector proved white-hot in terms of demand and sales increased 239% in March to 226,000 units.
The drive for cleaner and greener cars is further highlighted by the growth in Tesla sales. The China Passenger Car Association reported on Friday that Tesla sold 35,478 China-made cars in March. It was a much tougher quarter for US car manufacturers selling in China. General Motors Co. sold only780,200 vehicles in the January-to-March period, its worst first quarter in China since 2012, excluding the pandemic-ravished 2020.
Car Sales Impressive But Chip Shortages Could Hinder Growth
The latest sales figures take Chinese auto sales to the levels where they were two years ago. However, the figures are still down much lower when compared to 2018’s record March quarter, when 5.67 million cars were sold in China.
According to the Wall Street Journal, the Chinese auto market is not expected to reach the heights of the previous decade’s boom until around 2024.
One issue that may hit Chinese car manufacturers in the coming months is the global shortage of microchips. Chen Shihua, a senior executive at CAAM, said that they expect the chip supply shortage to have a much larger negative impact on China’s auto production in the second quarter of the year. The same chip shortage saw neighbours and economic rivals Japan post a larger-than-expected decline in its factory output in February.
