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China's Vehicle Inventory Alert Index stands at 54.1% in Oct.

Source: ce.cn | Date: Nov. 3

  • According to the China Automobile Dealers Association (CADA), the Vehicle Inventory Alert Index stood at 54.1% in Oct., down 1.6 percentage points from Sept.

  • On Oct. 1, China started to halve the vehicle purchase tax for cars powered by a 1.6L or a smaller engine. Thanks to the favorable policy, car sales increased in that month. However, auto dealers were plagued by capital crunch, intense inventory pressure, and brain drain. Accordingly, the overall inventory levels remained high. Inventory index stood at 59.2% in Oct., up 0.1 percentage point month-on-month.

  • In Nov., demand is expected to remain unchanged compared with levels in Oct. 38.2% of auto dealers believe that demand will increase, while 11% take the opposite view. Survey shows that 18.5% of dealers believe that their operation will improve in Nov., while 17.3% think the opposite.

  • In light of the above-mentioned figures, CADA suggests that dealers adjust their inventories in a rational manner and fend off operational risks brought by changes in inventory levels.