Boost for car sales as confidence returns
The country’s car sales are expected to rise 7 percent next year as consumer confidence returns, the China Passenger Car Association said on Monday.
It said there were a number of positive factors which would drive sales, including government policies, sales promotions and the strong potential of new-energy vehicles.
"Sales growth is driven by government policies to promote auto consumption and ensure stable economic growth after the COVID-19 pandemic, and is proved to be effective based on the situation this year," said Cui Dongshu, the association’s secretary-general.
Demand for online shopping increased amid the pandemic, the association said, and sales of medium and heavy trucks posted rapid growth.
After the outbreak, policies to control the pandemic, stabilize growth and promote production had a positive impact on the overall automobile market, it said. Local governments encouraged consumption by issuing vouchers and relaxing purchase restrictions on cars.
The association said Spring Festival next year will lead to fast growth in sales. It expects growth of around 60 percent compared with the same period this year.
Cui said auto production in 2020 had been affected to a certain extent. In particular, production and sales of some joint venture companies have not reached a high level due to some supply and production constraints. In 2021, the release of restricted production capacity will further promote growth in the auto market.
On November 15, a free trade agreement involving 15 countries and regions in the Asia-Pacific region was signed, a move that will create new momentum for regional cooperation and facilitate global post-pandemic economic recovery, the association said.
This will give China's auto companies good opportunities in overseas markets, increasing market share and reducing the cost of parts and components.
This year, China's new-energy vehicle market enjoyed rapid growth, with annual sales of passenger vehicles exceeding 1.15 million units, slightly higher than in 2019. That momentum is expected to continue next year.
Cui said: "We are optimistic about the sales growth of China's auto market in 2021, but there are still some challenges ahead, including uncertainties in the overseas environment and a decline in buying activities among the younger generation."