The hottest auto market in the world is slowing rapidly
A Chinese Geely Motors employees sits in a completed car at their manufacturing plant in Cixi, 50km from Ningbo in China’s Zhejiang province. Chinese manufacturing activity hit a seven-month low in June, putting pressure on Beijing to do more to boost the world’s second-largest economy.
China has overtaken the US to become the world's largest auto market. But growth in Chinese auto sales slowed in July.
Passenger car sales slowed to an 11 percent growth rate, down from June's 15.8 percent rate, according to China Association of Automobile Manufacturers, quoted by the AP.
Meanwhile, total vehicle sales climbed 8 percent, down from 10 percent in June.
Last night, China's massive economic data dump showed that retail sales slowed to 13.1 percent year-over-year, and a sub-index showed that auto retail sales growth by value fell to 4.7 percent in July, from 6.2 percent in June.
This will definitely be worrisome for international car manufacturers that have been looking to China too boost auto sales as their local markets slow.
In fact, the focus of the auto industry has been shifting to China, after auto sales jumped in 2009 after Beijing cut taxes and offered subsidies in the wake of the 2009 financial crisis. IHS Global Insight had projected that annual auto sales in China will grow by 74 percent to over 30.6 million a year by 2020.
Despite the growth prospects, automakers will be concerned with the recent slowdown in China, the investment in subways and railways, and curbs on auto sales in cities like Beijing, Shanghai, Guangzhou and Guiyang.
More from our partners at Business Insider:
Business Insider: The Mongols Would Have Won The Olympics By A Mile
Business Insider: The Funniest Memes From The Curiosity Rover Landing
Business Insider: Meet The Secretive Group Earning $8 Billion From The Olympic Games
Business Insider: BII Report: The Future Of Mobile Advertising
Business Insider: The Latest Economist Cover Goes After Merkel's Anti-Euro Policy
At The World, we believe strongly that human-centered journalism is at the heart of an informed public and a strong democracy. We see democracy and journalism as two sides of the same coin. If you care about one, it is imperative to care about the other.
Every day, our nonprofit newsroom seeks to inform and empower listeners and hold the powerful accountable. Neither would be possible without the support of listeners like you. If you believe in our work, will you give today? We need your help now more than ever!