China’s car sales rose for the first time in a year last month, but the world’s largest market remains stuck in a deep slump that shows little sign of ending soon as the country’s massive economy slows.
The slump was caused mostly by a bigger decrease in China sales than it had expected, the company said. Geely’s sales fell 33% in its home market.
Global brands are suffering, too. Ford (F) said last week that it sold nearly 22% fewer vehicles in China during the second quarter than in the same period a year ago. General Motors (GM) posted a 12% drop in vehicle sales in China for the quarter.
Several major Chinese automakers have experienced even steeper falls. Haima Automobile reported a 70% slump in sales for the first five months. Chongqing Changan Automobile, Ford’s Chinese partner, posted a 33% drop during the same period.
Suppliers are feeling the pain. BASF (BASFY), the German chemicals giant, on Monday slashed its profits forecast for the year on Monday, blaming weak car sales and trade tension between the United States and China.
“Globally, [auto] production declined by around 6% in the first half of 2019. In China, the world’s largest automotive market, the decrease was more than twice as high, at around 13%,” it said.