Car Sales Fall Again in China

Sales of new passenger cars in China shrank 3% to 1.75 million units in May, according to the China Assn. of Automobile Manufacturers.

Analysts blame the lingering effect of a January hike in the purchase tax on vehicles with engines displacing fewer than 1.6 liters to 7.5% from 5%. Year-on-year sales declined 4% in April.

SUV/crossover sales were a bright spot last month. Demand for those vehicles jumped 14% to 714,800 units in May. Deliveries of sedans dropped 9% to 838,700 units, and sales of multipurpose vehicle plunged 17% to 149,700 units, according to CAAM.

Deliveries of electrified vehicles, which rose 8% to 34,400 units in April, zoomed 28% year-on-year to 45,300 units last month.

The government-backed trade group says overall vehicle sales in China, including commercial vehicles, grew 4% to 11.18 million units in January-May. The market expanded 7% in the same period last year.