China's PV sales likely to fall in May

Shanghai, May 14 (Gasgoo.com) Although China saw its passenger vehicles sales hit a new record high in April, the PV sales in May is likely to drop from April sales mainly because the incentive-boosted hot sales will get less warm, according to Sinotrust, an auto industry research firm, sina.com said today.

China sold 831,000 sedans, minivans and other passenger vehicles in April, a rise of 37.37% year on year, the most in three years, said the China Association of Automobile Manufacturers (CAAM). The PV sales were 604,900 units in April 2008 and 772,400 in March 2009.

Seven of the top 10 passenger car makers in China posted sales growth last month. Shanghai VW, FAW VW, Shanghai GM and Beijing Hyundai each saw their April sales rise to 50,000 cars, with the sales of Shanghai VW exceeding 60, 000 units, retaining its lead in China's monthly sales of passenger vehicles.

The better-than-expected growth in April sales of passenger vehicles was largely boosted by the government's auto sector stimulus measures released since the beginning of this year, which include having the sales tax to 5% for small cars and providing subsidies to buyers of new-energy vehicles.

However, Sinotrust said the PV sales in May are likely to drop 10% from April's record, as the hot sales stimulated by the auto sector incentives may begin to cool down. The halved 5% sales tax on small cars with engines of 1.6 liters and less has been implemented for more than three months.

And usually May to August are the off season for China's passenger car sales, which are expected to slow down month on month during that period, said the auto research company.

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