CASHBACK offers, up to 10 free oil changes, generous prepaid gasoline cards — these are just some of the giveaways China’s auto dealerships are using to woo customers out and about after spending much of February and March in lockdown.

For the most part, they are getting the job done.

Cui Peng, a Geely sales manager in the eastern city of Hangzhou, said unit sales at his dealership jumped 30 percent in April from March and they are hoping for 25 percent growth in May.

That is partly due to delayed demand after China shut down to contain the coronavirus. But it is also thanks to an offer of six free engine oil changes, worth around 3,000 yuan (US$420), for customers who buy models such as the Binyue sport utility vehicle.

“Although car retail prices are not much different from usual, customers get to enjoy these complimentary services that do not impact our budget much in the short term,” he said.

In the nearby city of Ningbo, a Toyota Motor Corp. dealership offering 10 free oil changes saw April vehicle sales return to pre-virus levels and is aiming for sales in May to climb 10 percent month on month, its marketing manager Chen Xiaotian said.

Even some luxury brands were offering deals, with one Lexus store in Hangzhou enticing customers with thousands of yuan in cashbacks.

Their efforts helped China log its first positive growth in vehicle sales in nearly two years, up 4.4 percent in April from the same month a year earlier.

Industry executives believe the generous deals currently being offered to customers are priming the market for a return to price wars.

Feng Xingya, general manager of State-owned automaker GAC which has partnerships with Toyota and Honda Motor Co., believes a bruising price war is on the cards.

“When there is not much demand amid a pickup in production, price competition will obviously increase,” he said.

“Offering gifts and cashbacks suggests a lack of substantial customer demand,” said Alan Kang, a senior LMC Automotive analyst.

Kang believes China auto sales will be either flat or show slight growth in the second half of this year. (SD-Agencies)