China’s auto consumption is expected to stay firm as high-frequency data including wholesales and used car sales shows that Chinese residents’ willingness to buy cars remain high, according to a note from TF Securities.
Used car transactions in the financial hub of Shanghai having been higher than the level seen in the same period in 2019 – 2022, it said.
In each of the first three weeks of October, wholesale volume of automobiles fell 6%, rose 14% and rose 23%, respectively, from the same period last year, with wholesalers remaining optimistic, according to the note.
China’s cumulative car sales have returned to growth year over year and the year end approaches, Chinese people tend to purchase vehicles before the policy to cut purchase taxes expire by the end of the year and auto consumption in the last two months of the year is expected to stay strong, said the broker.
(Chart: used car transactions in China remained at high levels. TF Securities.)