China wholesales 1-20 August 2020: Partial data shows post-pandemic bounce screeching to a halt: -4.2%

Clouds on the horizon for the Chinese market? Picture: the new generation Haval H6, launched in August.

Figures released by the China Association of Automobile Manufacturers (CAAM) could indicate the end of the much-admired post-pandemic rebound in China. After April (+4.4%), May (+14.5%), June (+11.6%) and July (+16.4%) all showed gravity-defying surges, wholesales of new vehicles by a selection of 11 local manufacturers are down for the first time since Covid-19 lockdowns ended at -4.2% year-on-year in July to 939.000 units. It’s worth noting that production however is up by a spectacular 46.4% year-on-year to 1.111 million units, marking a rare and wide difference between the two figures. Extraordinarily high wholesales volumes in the past quarter have meant dealerships now have high inventories, which could explain the deflated July wholesales figure vs. production. As a reminder wholesales volumes are ex-factory deliveries to dealerships.

In the segment detail, Passenger Vehicles drop -7.9% to 825.000 and even though Commercial Vehicles remain euphoric at +36.3% to 114.000, they can’t single-handedly tilt the market into positive. PV production is up 39.9% to 934.000 while CV production soars 88.2% to 177.000. All is not lost however, as these volumes do not take into account the entire Chinese market but 11 Chinese automakers that are easily accessible to CAAM analysts: Brilliance, BYD, Changan, Chery, Dongfeng, FAW, GAC, Geely, Great Wall Motor, JAC and SAIC. We estimate these manufacturers amount to roughly half the Chinese market, and given Chinese brands have tended to fare worse than foreign ones lately, a year-on-year July uptick could still be in the cards. Final answer around September 10.

Previous month: China wholesales July 2020: Post-Covid rebounds accelerates to +16.4%, Toyota (+29.3%) smiles, VW (-6.1%) cries

Previous mid-month update: China wholesales 1-20 July 2020: volumes surge 36.5%, confirming post-pandemic momentum