China Car Sales Dropped for Second Straight Month in July Amid Chip Shortage

By Erin Mendell

China's car sales declined for the second straight month in July from a year earlier as the global chip shortage continued limiting production.

Last month, retail sales of passenger cars fell 6.2% to 1.5 million vehicles, the China Passenger Car Association said Tuesday. Sales had fallen 5.1% in June, ending an 11-month streak of year-over-year growth.

A global shortage of semiconductors has curbed production in the auto industry, but the CPCA said Chinese brands haven't been as affected by the shortfall as foreign auto makers in recent months. Sales of domestic brands surged 20% in July, while those of major foreign joint ventures dropped 19%.

Honda Motor Co.'s sales in China slid 20.9% in July, while Nissan Motor Co.'s China sales fell 20.8%, the companies said last week.

German brands were hit the hardest by component shortages last month, the CPCA said.

Covid-19 infections have spread to more than a dozen Chinese provinces since late July, including in several car-manufacturing hubs, which the CPCA said could add pressure to market supply in August.

Sales of electric cars more than doubled from a year earlier to 222,000 vehicles, the association said.

Tesla Inc. sold 32,968 made-in-China vehicles in July, about 26% of which were sold to domestic clients, the group's data showed. More than 24,000 Tesla EVs were exported to other markets.

Tesla tends to export more cars from China at the beginning of a quarter.

--Raffaele Huang contributed to this article

Write to Erin Mendell at [e-mail]

(END) Dow Jones Newswires

August 10, 2021 05:16 ET (09:16 GMT)

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