China auto production, sales accelerate to double growth

China's automobile production and sales in August experienced double gains, both in comparison to the previous month and the same period last year, according to the latest data released by the China Association of Automobile Manufacturers (CAAM).

In August, domestic automobile production reached 2.575 million units, representing a month-on-month rise of 7.2 percent, while sales topped 2.582 million units, reflecting an 8.2 percent growth.

These figures indicate a continued recovery in the domestic market backed by various factors such as supportive policies and promotional activities, said Chen Shihua, CAAM vice secretary-general.

The Chinese government has implemented measures to stimulate consumption, including subsidies for new-energy vehicles and tax incentives for car purchases. Additionally, car manufacturers have offered attractive promotional incentives to encourage buyers. These factors have contributed to the sustained growth in automobile production and sales, Chen noted.

From January to August this year, cumulative domestic automobile production and sales reached 18.225 million and 18.21 million units, respectively, with annual increases of 7.4 percent and 8 percent. This indicates a positive trend in the industry's performance, surpassing the figures from the same period last year.

Xu Haidong, deputy chief engineer of CAAM, expressed optimism about the future performance of the domestic automobile market. "In the coming months, the performance of the domestic automobile market will surpass that of the same period last year and achieve positive growth."

Xu said that based on the current market performance, it is expected that total annual sales in 2023 will exceed CAAM's initial forecast of 27.6 million units, achieving a 3 percent increase.

Both passenger vehicle and commercial vehicle production and sales rose in August. Domestic production and sales of passenger vehicles approximated 2.28 million and 2.27 million units, respectively, surging 7.5 percent and 8.2 percent from July, and posting year-on-year increases of 5.4 percent and 6.9 percent.

Cumulative production and sales of passenger vehicles in the first eight months topped 15.67 million and 15.64 million units, separately, 5.9 percent and 6.7 percent higher than a year earlier.

Of note, the market share of Chinese brands in the domestic passenger vehicle market continued to steadily increase.

In August, Chinese brands sold 1.292 million passenger vehicles with a 25.6 percent growth on year, holding a market share of 56.8 percent which was 8.4 percentage points higher compared to August 2022. Among the major foreign brands, Korean and American brands showed bigger growth, while French brands faced a decline.

The domestic commercial vehicle market also witnessed double-digit growth last month. Domestic production and sales of commercial vehicles reached 300,000 and 310,000 units, respectively, representing month-on-month increases of 5 percent and 7.9 percent, as well as year-on-year gains of 26.2 percent and 20 percent. Among the major categories of commercial vehicles, both bus and truck production and sales showed double-digit growth compared to the same period last year.

Meanwhile, the new-energy vehicle market in China continued its remarkable growth last month. Domestic production and sales of NEVs added up to 843,000 and 846,000 units, respectively, climbing 4.7 percent and 8.5 percent on a month-on-month basis, while up 22 percent and 27 percent year on year. The market share of NEVs was 32.8 percent.

"The entire market for new-energy vehicles is experiencing rapid growth," Chen observed.

Automobile exports were another highlight. Since the beginning of 2023, China's automobile exports have shown outstanding performance, and reached 408,000 units in August with a month-on-month increase of 3.9 percent and a surge of 32.1 percent from a year earlier.

Chen pointed to the continuous effect of various policies, the upcoming "golden September and silver October" sales season for the industry, and major car companies constantly introducing new products. These will together contribute to further stimulating market demand and achieving the expected goals for the economic development of the automobile industry, he added.