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VIA rises as automakers boost sales at year's end

Source: Beijing Business Today | Date: Dec. 8

  • Figures from the China Automobile Dealers Association indicate that the VIA (Vehicle Inventory Alert Index) reached 61.8% in Nov., a rise of 7.7 percentage points over last month, stayingthe alert line. The Association's deputy secretary general Lang Xuehong has attributed it to a significant fall in market demand.

  • In Oct., China's car sales dropped by 1.2% to 1,055,272 units, while Jan.-Oct. sales were down 8.3% to 9,310,893 units. Insiders believe that auto dealerships are facing soaring inventories as automakers have worked out their wholesale targets for the final quarter to achieve their full-year sales targets. This suggests that automakers are demanding their dealerships to take in news vehicles, which has resulted in a rise in VIA.

  • Entering Nov., mainstream automakers, such as GM and Ford, have achieved fast sales growth. GM saw its sales grow 14% in Nov., hitting a record high. In the month, indigenous auto brands also saw a significant rise in vehicle sales. For example, BAIC Motor sold 43,780 vehicles, representing a 18.8% rise over a year earlier.

  • However, auto dealerships are facing a dilemma as the demand index fell to 43.9% in Nov., 11.3 percentage points lower than Oct. Therefore, auto dealerships should make efforts to control their inventories at a reasonable level to avoid risks amid the current market situation. Also, automakers shouldn't transfer their sales pressure to dealerships since it is very important for automakers to maintain a stable and healthy sales system.