China's passenger vehicle market got off to a rousing start in the newly welcomed Year of the Horse as sales broke records in January.
Last month, 1,881,835 cars, sport-utility vehicles, multipurpose vehicles and minivans were sold in China, an upswing of 10.1 percent year on year, and 3.7 percent higher than December's sales figures, the China Passenger Car Association said Wednesday.
"The January sales were remarkable, given that the 10 percent growth rate was based on one that boomed more than 45 percent over 2012", said Rao Da, secretary-general of the association. "It also indicates continuous growth in the automobile sector in 2014, after the market recovered from two years of near stagnancy in 2011 and 2012," he added.
Jia Xinguang, an independent auto analyst based in Beijing, attributed the record deliveries to the Spring Festival holidays, which are a popular time to purchase vehicles thanks to annual bonuses, toll-free travel periods and festival gift-giving.
"Panic consumption'" over more cities' joining the purchase limitation policy also supported the sales growths," said Rao, adding that "the situation will continue in the coming months."
Rao said that as the sales were much greater than the 1,721,525 units that were produced in January, dealers' average inventories have started to drop. "It is a good sign for the struggling dealers."
He predicted that the market will maintain its growth in February, even though there are only 17 working days this month. The reason? "Other than panic consumption, Chinese government's tightened regulation on official cars will make more civil servants join the individual buyer group," Rao said.
Although the Chinese government has issued policies to shore up domestic automakers, homegrown brands still face losing market share as their foreign rivals have invested heavily to strengthen their foothold in the world's largest automobile market.
In January, General Motors and its joint ventures set a monthly sales record in China with deliveries of 348,061 vehicles, an increase of 12 percent over January 2013, the previous sales-record month.
Domestic sales by Shanghai GM and SAIC-GM-Wuling and their Buick and Wuling brands all reached all-time highs as well in January. Also from the United States, Ford Motor Co reported a surge of 53 percent year-on-year with 94,466 vehicles in China in January.
German luxury vehicle provider Daimler said that sales of Mercedes-Benz vehicles jumped more than 42 percent to a record 24,887 vehicles in January.
Its German competitor Audi also saw sales increase by 18.2 percentfrom a year earlier to 44,226 vehicles during the same period.
Nissan China reported sales of 9,200 vehicles in China in January, a dip of 0.4 percent from 2013. Nissan said that without the impact of the Spring Festival, the Japanese company would be reporting a sales increase of 15 percent in January.