CPCA sees Chinese car market sales recovery in April

China's car market sales are expected to only recover in April except for Hubei province, the epicentre of the coronavirus outbreak, according to the country's industry group.

The country's automotive sales are forecast to fall by 30pc from a year earlier in February because of the coronavirus crisis, with January-February sales expected to drop by 25pc, said the secretary-general of the China passenger car association (CPCA) Cui Dongshu.

China's car sales slumped by 20pc from a year earlier to 1.61mn in January, according to the China association of automobile manufacturers, mostly because of lunar new year holidays that cut the number of work days that month. The impact of the coronavirus outbreak is expected to have a much larger influence on sales from February.

China's daily sales of passenger cars slumped by 89pc from a year earlier to 4,089 units in the second week of February, according to data issued by CPCA. Daily sales in the first week of February fell by 96pc to 811 units. Only a few car dealers restarted in early February amid the coronavirus outbreak, while most potential buyers stayed at home amid the outbreak.

But car sales for 2020 will still grow by 1pc with a potential rise in demand from March, Cui forecasts. Limited public transport capacity, which is part of the country's quarantine measures to contain the spread of the coronavirus, is expected to prompt people to buy private cars to prevent future coronavirus infections.

China's local governments are expected to provide financial aid to support the car market. Fushan city in south China's Guangdong province will offer a 2,000-5,000 yuan ($1,320-3,300) per unit subsidy for new car sales effective 1 March.

Disruptions in the auto industrial chain of Hubei are expected to continue as authorities have ordered all companies in the province to stay closed for another three weeks.

Hubei is home to around 8-9pc of China's total automobile production, as well as a large number of its auto components manufacturers. Auto producers in Wuhan city, including Dongfeng Motor's joint ventures with Renault, Honda and PSA, have not said when their production will resume.

Confirmed coronavirus cases in Hubei province reached 62,442 as of today, up by 443 from yesterday. The coronavirus has killed nearly 2,300 and infected over 75,000 people in China as of today, up by 892 from a day earlier, according to government figures.