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This is reported by the Chinese car industry organization PCA. The collapse of car sales comes at a time when car manufacturers actually saw the market recover after a two-year decline in sales. Manufacturers have put billions in the Chinese market, the largest in the world.
Car sales in China were just starting to recover.
Ⓒ AFP
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The fall in sales is widely felt: from market leader Volkswagen and electric car manufacturer Tesla to smaller local players. Since the outbreak of the corona virus, sales by car manufacturers to dealers in China have already fallen by 86%, according to the PCA.
Discount
Although the Chinese government has made the car industry a top priority, it still lacks concrete measures. Local governments try to take measures themselves to achieve the economic objectives.
The South Chinese city of Foshan is giving car buyers a $ 430 discount. The Guangzhou city government gives buyers of electric cars powered by renewable energy a bonus of $ 1,430 and the city of Xiangtan protects its own market by giving car buyers who purchase a car from Chinese car maker Geely a $ 430 bonus.
Growth slowdown
Due to the slowdown in the economy and the growing budget gap, the Chinese central government has limited options to help the automotive industry. There would still be opportunities to boost sales by reducing the 10% sales tax on car sales and simplifying the emission tax and encouraging the purchase of clean cars.
Not only the car industry is struggling with major problems. Millions of Chinese companies are in danger because consumers stay home and production is disrupted. The corona virus can cost China 6% of GDP, investment company Pimco has calculated.
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