China car sales to slow down in 2017
The tax cut on small-engine vehicles produced a surge in China car sales last year, much to the delight of global carmakers. Honda saw its sales leap ahead by 24% last year, while Toyota and Ford each reported a better than 8% increase over the previous year.
This year could be a lot less cheerful. The tax break has been rolled back, and the Chinese economy continues to slow down.
Toyota expects its China sales this year to hover around the 1.2-million mark, its figure for 2016. Honda still sees its sales progress, but only by 7.4%, in line with the overall economy.
The gentle rollback of the tax break should ease the sales gloom: the purchase tax on cars with engines up to 1.6 litres will rise from 5% to 7.5% this year, and only go back to 10% by 2018. As a result, experts now predict that China car sales will go up by up to 5% this year instead of dropping 2% if the tax cut had expired completely at New Year.
Image: Anna Frodesiak, CC0
| 10/01/2017 | Frank Jacobs