Vehicle Inventories Hit 4-year high at 170,000 units
2008-07-23 Source：english.chinabuses.com
Summarize：Inventories of unsold new vehicles in China rose to a four-year high at the end of June, as sales growth slowed unexpectedly while auto makers boost output, the official China Securities Journal said ...
Inventories of unsold new vehicles in China rose to a four-year high at the end of June, as sales growth slowed unexpectedly while auto makers boost output, the official China Securities Journal said on Tuesday.
The backlog came to 170,000 vehicles as of the end of June, the highest since a previous peak of 200,000 at the end of June 2004, the newspaper said, citing Cheng Xiaodong, chief auto analyst with the price monitoring centre at the National Development and Reform Commission.
Analysts blamed the rising stockpile on slowing growth in the world's second-largest auto market, hit in part by the government's decision to end a week-long spring holiday and by natural disasters, particularly May's devastating earthquake in southwest China, which dampened consumer sentiment.
In the second half, analysts expected a nearly 20 percent hike in retail fuel prices unveiled late last month would also weigh on demand.
"The backlog will certainly rise further in the second half, as the situation is unlikely to be any better in the coming months," said Yi Junfeng, an industry analyst with Changjiang Securities.
In the first half of the year, car sales in China increased 17 percent to 3.61 million units, after growing more than 20 percent annually since 2005.
Overall vehicle sales in January-June rose 18.5 percent to 5.18 million units, down from a 21.8 percent full-year rise in 2007, according to official data.
At the same time, production capacity has been surging.
"Auto makers have been rapidly adding capacity as many expected vehicle sales to top 10 million units this year. Few had expected a slowdown," Yi said.
Japan's Toyota Motor, which makes cars in China with partners FAW Group and Guangzhou Automobile Group, parent of Hong Kong-listed Denway Motors, has unveiled expansion schemes this year that will boost its annual production capacity in the country by 187,000 cars, from its current 813,000.
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