SHANGHAI — The China Association of Automobile Manufacturers, citing widespread uncertainties brought on by the coronavirus outbreak, has declined to update its outlook for new-vehicle sales this year.
But another organization, the China Passenger Car Association, made an attempt this week, and in an optimistic scenario predicted annual sales of new passenger vehicles — including sedans, SUVs, crossovers and multipurpose vehicles — will drop nearly 10 percent.
Bold as it is, the forecast is based on fairly comprehensive research.
The research takes into account the outbreak’s impact on a board range of factors, ranging from economic growth and consumer purchasing power to how fast production resumes at automakers and suppliers.
Notably, because of CPCA’s affiliation with the China Automobile Dealers Association, the research also fully considers feedback from the front lines: dealerships.
CPCA, formed in Shanghai in 1994 as a data-sharing outfit for China’s passenger-vehicle manufacturers, became CADA’s research unit in 2017.
While more than 90 percent of China’s franchised dealers have reopened as of Monday, showroom traffic is just 53 percent of normal levels. In addition, 53 percent of dealers surveyed remain pessimistic about retail sales in the next three months, according to CADA.
The epidemic, which broke out in the central city of Wuhan in January, is mostly under control inside China. While the outbreak has become a full-blown global pandemic, inbound visitors who have been infected overseas are threatening to undermine control inside China.
On Wednesday, while no new infections were reported that originated locally, 34 imported cases were detected at airports across China.
Because of disruptions caused by the outbreak, retail sales of new passenger vehicles plunged 82 percent to some 250,000 in February, with year-to-date volume slumping 41 percent to roughly 2 million, according to CADA.
CPCA expects new-vehicle sales to return to normal in the second half of 2020. With a sharp decline in the first half, annual new-car retail sales will drop 9.7 percent to 18.7 million, it predicts.
But such a forecast is based on the assumption that China can keep up efforts to curb the spread of the virus, CPCA noted.
If a new wave of infections emerge in the country, which is likely to be triggered by cases that originate outside China, the new-car market will contract more severely, it warned.
CAAM, still declining to provide an updated full-year forecast, on Thursday predicted that overall new-vehicle deliveries will slip 25 percent in the first six months.
CAAM didn’t provide a separate forecast for passenger vehicles, which account for a lion’s share of the new-vehicle market.
But a 10 percent drop in volume looks like the best thing one can hope for passenger-vehicle sales this year.
