China car sales go from strength

 China car sales go from strength to strength as virus subsides

 Auto sales continued to rebound in China last month as the coronavirus pandemic subsided in the country and electric vehicles gained more users.

Retail sales of cars, SUVs and multipurpose vehicles rose 8% from a year earlier to 2.02 million units in October, the China Passenger Car Association said on Monday. Wholesale sales of new energy vehicles, which includes electric cars, more than doubled to 144,000 units.

The fourth consecutive monthly gain in the world's largest car market adds to optimism that a slide that lasted more than two years is over. Competitors such as market leader Volkswagen AG and Toyota Motor Corp. are driving sales, while government incentives are helping electric vehicles from companies like Tesla Inc. and NIO Inc. gain traction.

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The rebound is a relief for manufacturers who have spent billions of dollars setting up plants and distributing in China over the years. Continued growth that spanned decades gave way to a slowdown in 2018, raising questions about the long-term vitality of the market.

China's relatively low vehicle ownership of 196 units per 1,000 residents means there is still plenty of room for growth. The country is expected to remain the world's top auto market, the Ministry of Industry and Information Technology said over the weekend.

Annual passenger vehicle sales will continue to show a decline of around 7% this year, PCA predicted, after big drops during the height of the pandemic. That's better than the 11% decline PCA projected in July.

Electric vehicles are consolidating their role as an engine for growth, aided by incentives such as purchase subsidies. Sales of new energy vehicles, which include pure battery electric vehicles, fuel cell cars and plug-in hybrids, are expected to rise to around 1.1 million units this year, according to the China Association of Automobile Manufacturers.

Tesla sold 12,143 vehicles in China last month, ranking fourth in NEV sales, behind SAIC-GM Wuling Automobile Co., BYD Co. and another unit of SAIC, PCA said. The American company exported about 10,000 Chinese-made vehicles to other countries, PCA said. Tesla said on October 20 that it will begin exporting the Model 3 from China to markets such as Germany, France and Switzerland. A company representative declined Monday to comment on the figures provided by PCA.

In China, Tesla faces increasing competition from local rivals, and BYD and NIO consolidate their position as the largest Chinese automakers by market value. The market capitalizations of the two companies have outpaced local gasoline-guzzling manufacturers with much higher sales volumes.

"Overall stock price gains for electric car manufacturers show that electrification of smart cars is an irreversible trend," NIO founder William Li said on Friday. NIO's monthly sales exceeded 5,000 units for the first time in October,