China’s monthly auto sales have surprisingly risen despite COVID-19 related lockdowns still on in some cities. The China association of automobile manufacturers said that auto sales in July surged 29.7% from a year earlier to 2.42 million units.
Despite a steep rise of nearly 30% from 2021, the sales figures failed to cross June’s numbers by 3.3%. Sales of new energy vehicles which include pure electric vehicles, plug-in hybrids and hydrogen fuel cell vehicles increased 120% in July from the year prior. Higher oil costs and battery prices are pushing consumers to economic plug-in hybrids.
Sales of hybrid cars nearly tripled in the first seven months of the year while sales of purely electric vehicles doubled. Experts believe annual sales of gasoline cars which are sold with bigger discounts are expected to fall for the fifth straight year in 2022. China has tried to revive auto demand with incentives such as lower sales tax for small engine vehicles and subsidies to spur trade-ins of gasoline for electric ones.
The Chinese automobile industry is still struggling with months of stringent lockdowns in major manufacturing hubs of Shanghai and Changchun. The industry was seriously hit hard by efforts for combating COVID-19 earlier in the year. Furthermore, higher costs of battery prices and oil are pushing consumers to buy plug-in hybrid vehicles. The sales of hybrids have nearly tripled in the first seven months of the year whereas the sales of purely electric vehicles have also doubled.