CHINA’S monthly auto sales rose for the first time in almost two years as the country eased virus-related curbs and reopened for business, but the annual number will likely be slashed by 15 percent if the pandemic continues, an industry body cautioned.

Even if China contains the outbreak effectively, its auto sales is expected to drop 15 percent this year, from over 25 million units in 2019, the China Association of Automobile Manufacturers (CAAM) said, the country’s largest auto industry association.

In April, China’s auto sales reached 2.07 million units, up 4.4 percent from a year earlier, even as sales of new energy vehicles (NEVs) fell for a 10th month to 72,000 units, CAAM data shows.

NEVs include battery-powered electric, plug-in hybrid and hydrogen fuel-cell vehicles.

China’s auto sales sank 79 percent in February and 43 percent in March, pummelled by the virus as stay-at-home orders kept buyers away. Monthly sales last rose in June 2018.

“The sales rebound in April fell short of expectations but … will increase in the next two months” due to the release of pent-up demand as lockdown measures are further eased, CAAM official Xu Haidong said.

The data supports a growing optimism that China’s auto business is improving, but experts caution the sector is not out of the woods yet and sales could take a bigger hit if the global health crisis deepens and chips away at its exports.

China’s auto exports are expected to drop by 200,000 units this year, from about a million in 2019, as virus erodes global demand, said Chen Shihua, a CAAM official, adding shutdown in overseas plants could disrupt China’s production supply chain.

Volkswagen reported positive China sales in April, while General Motors’ China ventures saw double-digit year-on-year growth last month.

Japanese automaker Nissan Motor said yesterday its April sales in China grew 1.1 percent from a year earlier to 122,846 vehicles.

U.S. electric vehicle maker Tesla Inc. sold 3,635 Shanghai-made Model 3 vehicles in China in April, down 64 percent from March, according to the the China Passenger Car Association.

Tesla’s sales in the first month of each quarter are usually lower than the remaining two months. The industry body said during an online briefing that Tesla produced over 10,000 units in Shanghai last month.

(SD-Agencies)