China Retail October 2019: Jetta up 81% month-on-month in market down -10.5%

Jetta is selling all the VS5 it is producing so far.

Chinese registrations (or retail sales) of locally-produced vehicles are back into the double-digit drops for the third time in the past 4 months in October at -10.5% to 1.620.585 units according to our exclusive figures. Note BSCB is the only non-Chinese media to report on monthly Retail Sales for this market. Once again this is a much higher decline rate than wholesales drop for the same month (-4%), meaning dealerships across the country continue to bump up their stock in preparation for traditional high promotional activity towards the end of the year. Year-to-date retail sales of the vehicles included in our study are down -3.3% to 16.709.014 vs. -9.7% for wholesales.

Quite encouragingly, the Top 5 brands are relatively unaffected by the market depression, all behaving much better. Volkswagen (-2.1%) reduces its fall thanks to enduring very strong scores by its new SUV lineup – Tayron (19.559), T-Roc (11.443), Tharu (10.911) and T-Cross (record 5.591) – as well as a handful of blockbuster sedans – Passat (+57.7%), Sagitar (+34.4%) and Bora (+33.2%) – enjoying the benefits of new generations. Honda (+3%) is the only carmaker in positive in the Top 7 thanks to outstanding performances by the Crider (+82.6%), CR-V (+19.4%) and Civic (+14%), Toyota (-6.7%) endures a third straight negative month despite the C-HR (+56.9%), IZOA (+21.5%), Levin (+10.5%) and Corolla (+0.8)%), Nissan (-2.4%) edges down but the Lannia (+17.2%), Sylphy (+4.4%) and Qashqai (+1.5%) are solid and Geely (-0.5%) is faithful to its title of #1 Chinese marque, posting its smallest decline and largest monthly volume since last June at just under 100.000 units, with the new Binyue (10.014), Jiaji (2.957) and Star (2.285) compensating for a freefalling existing lineup.

Below, evolutions are more volatile with largest gains but crippling falls as well. Hongqi (+231%) manages a 2nd consecutive (and ever) five-digit retail sales month mainly thanks to the H5 sedan (+117.7%) and HS5 SUV (3.743), Jetour (+73.2%) celebrates one year in market with its largest volume since June just as the X90 approaches the 3.000 monthly registrations, Lynk & Co (+36.8%) takes advantage of the success of the 03 sedan accounting for 47% of its October volume, Volvo (+36.5%) is lifted by the S90 sedan (+38.2%) and new XC40 (1.394), Mercedes (+28.3%) continues on an extraordinary year thanks to the GLC (+28.4%), C-Class L (+25.5%) and E-Class L (+12.7%) and Roewe (+10.8%) is dynamited by the i5 (+517.9%). Qoros (+154.6%), NIO (+49.8%), Maxus (+28%), Land Rover (+13.1%), Audi (+6.6%), BMW (+2.1%), Changan (+2.1%), Infiniti (+1.2%) and Chery (+0.7%) also manage upticks in the remainder of the Top 50.

One of the leading stories in China as 2019 comes to an end is the launch of Volkswagen’s new low-cost brand Jetta. We were impressed last month with a 56% wholesales-retail conversion rate (11.080 wholesales and 6.174 retail). If Jetta wholesales seem a tad shy in October (+12.9% on September to 12.505), this is not the case for registrations, up a fantastic 81% to 11.173. This gives us a whopping 89% wholesales-retail conversion rate which indicates consumers are gobbling up all available Jetta vehicles in dealerships and stock is thinning dangerously. In other words, Jetta urgently needs to increase its production cadence to meet with demand, which is one could say a lovely position to be in. The distribution between the two Jetta models varies slightly compared to last month: the VA3 sedan grows from 17% to 20% share just as the VS5 drops slightly from 83% to 80%, which is consistent with wholesales figures. Note the VS5 had slightly more retail sales than wholesales in October (8.935 vs. 8.837) which would confirms out-of-stock fears. Below Jetta (#39) and Bestune (#43), no other recently launched brand (<12 months) manages to sell over 2.000 units this month, illustrating the tricky current environment in China.

The Nissan Sylphy (+4.4%) tops the models ranking for the 4th time in the past 12 months, marking eight consecutive months in the Top 2 and overtaking its archenemy the VW Lavida (-6.4%). Note these two blockbusters now have EV variants but these only account for a tiny share of their October sales: 0.2% for the Sylphy and 0.6% for the Lavida. Sedans continue to hold a tight grip on the charts with 9 in the Top 10, with the odd one out being the best-selling SUV in the country: the Haval H6 (-34.4%) at #6. The Toyota Corolla (+0.8%), VW Sagitar (+34.4%) and Buick Excelle Yinlang (+13.3%) round up the Top 5 with the VW Passat, Bora, Toyota Levin and Honda Civic also selling strong. The VW Tayron ends the month only 107 sales off a very first Top 10 finish while the Roewe RX5 (+1.4%) is back up 34 spots on last month thanks to its facelift. The Haval M6 (+130.7%), Audi Q5L (+202.9%) and BMW X3 (+99.4%) also make themselves noticed. The Chevrolet Monza (#27) is the most popular new launch (<12 months) ahead of the Changan CS75 Plus (#39), BYD Song Pro (#45), Changan CS35 Plus (#46), Geely Binyue (#48) and Jetta VS5 (#53). New for October, we welcome the Beijing EU5 (#149), Ford Focus Active (#319), BMW X2 (#393), Beijing EU7 (#405), WEY VV7 GT (#419), Baojun RS-3 (#421), BYD e3 (#516), GAC Aion LX (#522), Maxus V90 (#554), JMEV EX5 (#576), Renault City K-ZE (#577) and Renault Captur (#595).

Previous month: China Retail September 2019: Mercedes (+18.2%), BMW (+16.7%), Honda (+15.3%) shine, Jetta scores 6.174 sales in market down -9%

One year ago: China Retail October 2018: Toyota, BMW, BYD survive -14% decline

Full October 2019 Top 100 All China-made brands and Top 640 All-models below.