Sales of luxury cars rise amid the pandemic
Sales of luxury cars in China grew in April with the overall market stable amid the COVID-19 outbreak.
Luxury car dealers sold 277,000 units last month, an increase of 11.1 percent year on year, according to the China Automobile Dealers Association, while dealers in the passenger car market sold 1.48 million vehicles, down 10.5 percent year on year.
Luxury cars accounted for 18.7 percent of the market in April, an increase of 3.6 percentage points compared with the same month last year and an increase of 0.4 percentage points of the market share in March. In April last year, luxury vehicles accounted for 15.1 percent of the total market.
Despite April’s recovery, China's luxury car market declined 16.4 percent year on year to 795,000 units in the first four months mainly due to the impact of the pandemic. In March, luxury automakers rolled out policies to support their dealers to get back to work. After work resumed, sales at luxury car dealers fell just 3.1 percent year on year during March and April.
Automakers had various ways to help their dealers sell vehicles. Some provided dealers with sales incentives and promotional funds. Some provided vehicles in advance to help dealers restart their businesses.
Audi provided A6L and Q5L vehicles and reducing the sales burden and assessment of dealers as well as offering subsidies of up to 3,000 yuan (US$420) to front-line sales staff. Volvo said it had been supporting its dealers since early February. BMW formulated policies to support dealers from March to May and provided subsidies for best-selling models.
In April, sales of luxury sedans were higher than those of luxury sport-utility vehicles (SUVs). The market share of sedans and SUVs was 52.1 percent and 46.3 percent, respectively. Sales of luxury sedans and SUVs totalled 144,000 and 128,000 units, up 3.1 percent and 22.2 percent year on year. The suspension of car companies overseas led to increased sales of medium and large SUVs in China by 62 percent year on year in April.
Li Yanwei, an analyst at the China Automobile Dealers Association, said most carmakers’ support policies would continue to the end of May. Dealer inventory and sales pressures were at appropriate level, Li said, market prices were relatively stable and dealer profits had recovered. The overall weighted average transaction price of luxury cars was 387,000 yuan in April, down 2,000 yuan from March, Li added.
Retail sales of Mercedes-Benz totalled 62,200 units in April, according to the association, an increase of 4.7 percent. BMW's retail sales were 67,000 units, up 9.4 percent, and Audi 61,500 units, an increase of 29.9 percent year on year.
Retail sales of German automaker Porsche were 8,767 in April, up 23.9 percent year on year. US electric carmaker Tesla sold 4,255 units last month, a surge of 121 percent year on year.