Car sales hit the brakes despite price war

Vehicle sales in the mainland shrank 14.1 percent last month from December, the first such slide since August, data from the China Passenger Car Association showed yesterday.

However, the sales of 2.05 million units were up 57.1 percent from a year earlier.

Battery electric vehicle sales sagged 37 percent, far below expectations, a main source of pressure on market growth, said association secretary general Cui Dongshu.

A price war among carmakers will remain fierce this year, Cui predicted. More than 40 brands joined the price war that was triggered by Tesla in China last year.

Demand faltered in the world's largest auto market despite a renewed discounting push led by Tesla at the start of 2024.

That slowdown was even worse in South Korea, with Tesla selling just one EV as a raft of headwinds, from safety concerns to price and a lack of charging infrastructure, weigh on demand. Its sale of just a Model Y SUV was its worst month since July 2022, when the Austin, Texas-based automaker sold no vehicles at all, according to data from Seoul-based researcher Carisyou and the Korean trade ministry.

Across all carmakers, the number of new EVs registered in Korea fell 80 percent in January from December.

Carmakers are facing a slowdown in enthusiasm for EVs in South Korea as higher interest rates and inflation prompt consumers to rein in spending, while concerns about battery fires and a dearth of fast chargers are also damping demand.