SHANGHAI — China’s leading auto trade association estimates industry sales in April fell 48% year-on-year as zero COVID-19 policies closed factories, limited showroom traffic and curbed traffic. consumer and business spending.
The estimate represents the biggest drop in sales in the world’s biggest auto market since February 2020, around the start of the pandemic, when volume fell 79% from a year earlier.
Car sales in the first four months of the year could fall 12% from a year earlier, the China Association of Automobile Manufacturers said on Friday.
The sharp drop is the latest sign of the economic costs of emergency measures imposed by China to control a coronavirus outbreak in Shanghai and other cities in recent weeks and comes as manufacturers battle to restart production.
The overall sales estimate was also lower than a previous one based on retail sales for the first three weeks of April.
The China Passenger Car Association estimated retail passenger car deliveries in China were down 39% in the first three weeks of April from a year earlier.
Shanghai’s showrooms, stores and malls were closed during the month and the city’s 25 million people were unable to shop online for far beyond food and daily necessities .
Nomura analysts estimated in mid-April that 45 cities, representing 40% of China’s GDP, were under full or partial lockdown, with a growing risk of recession.
A survey by a Chinese auto dealer association showed showrooms in 34 cities were closed amid COVID-19 control measures in April, most for more than a week.
Before the Shanghai lockdown, electric vehicle sales were booming. Tesla’s sales in China jumped 56% in the first quarter, while its biggest rival in China, BYD, saw EV deliveries quintuple.
Earlier this week, three of China’s biggest electric vehicle makers also announced a sharp drop in sales.
Deliveries fell 42% at Xpeng Inc., 49% at Nio Inc. and 62% at Li Auto Inc., from March, according to company data.
SAIC Motor Corp., China’s largest automaker by sales and a partner of Volkswagen Group and General Motors, reported a 60% drop in sales in April.
Tesla aims to increase production at its Shanghai factory to pre-lockdown levels by May 16, according to an internal memo seen by Reuters.
The disruption at Tesla’s factory was one of the most high-profile consequences of China’s measures to control the latest, largest-to-date COVID-19 outbreak with strict controls.
Tesla’s progress, however, comes as a survey showed Japanese companies are struggling to reopen factories in Shanghai, indicating problems with the city government’s efforts to help key businesses get back to business.
