Passenger-car sales in China increased at a quicker pace for a fourth consecutive month in September, as car manufacturers presented discounts and customers purchased vehicles in advance of a week-long nationwide holiday.
The China Association of Automobile Manufacturers disclosed on Thursday that deliveries of vehicles including minivans and sport utility cars increased 8.8 percent to 1.32 million units last month. Sales rose 7.3 percent in August, 6.7 percent in July and 6.2 percent in June. Total sales of automobiles in September, including trucks and buses, increased to 1.65 million units or by 5.5 percent.
Carmaker stocks expanded gains in Hong Kong following the release of the data revealing that vehicle sales increased the quickest in seven months. Shares of companies such as Guangzhou Automobile Group Co. and BYD Co. have fallen this year over worries that the withdrawal of sales-tax breaks and rebates for countryside purchasers in January could decrease demand.
Analyst Han Weiqi at Shanghai-based CSC International Holdings Ltd. related that people have the impulse to purchase automobiles ahead of a long holiday, especially for October "as it's the best season for travel."
He added that the discounts offered by vehicle manufacturers have also contributed to the growth last month. However, overall demand has generally been lowered by the government's attempts to rein in consumer prices that progressed at the fastest speed in three years in July. The People's Bank of China has increased interest rates five times in the past 12 months and directed creditors to set aside a record amount as reserves. [source: Autonews]