02/03/2011

In The Year of Rabbit: China’s Declining Car Sales

As celebrations of  Chinese New Year ring out, some in the auto industry are worried about keeping their jobs. China Daily reports a significant slowdown in new car sales as the government restricts car registrations to just 20,000 license plates a month.

After years of explosive growth and exponential increase in vehicle traffic, Chinese authorities decided to deal with heavy congestion by limiting amount of new cars registered in the major cities like Beijing. Rural areas and less populated cities will not be subject to these new rules; some believe this will force car manufacturers to expand deeper into undeveloped markets.

December had the high sales numbers as car shoppers sought to take advantage on expiring government incentives. January however has been incredibly slow forcing dealers to go the extreme measures.[quote float=”left”]We’ve heard the store will lay off 60 to 70 percent of its sales staff after the holiday,” said Liu Jun[/quote] Jun did not receive even one prospective buyer in January.  Industry insiders are mixed about the outlook for this year but we hope that a rabbit’s foot will bring luck.

Author: Alex Marinov

Alex Marinov is the president of RCG Logistics LLC, with years experience in the shipping and freight industry. His main interest include sustainable building design, video production and automobiles.