China Automobile Dealers Association: Automobile production fell 7% and consumption fell 10% in May 2022

According to data from the National Bureau of Statistics, automobile production in May was 1.99 million units, a year-on-year decrease of 5% , while new energy vehicle production was 500,000 units , a year-on-year increase of 108% , with a penetration rate of 25.1% , which is a very high growth.

The added value of automobiles fell by 5.7% from January to May 2022 , and by 5% in May 2022. Automobile production suffered the greatest loss under the epidemic. The total retail sales of automobile consumer goods fell by 9.9% year-on-year from January to May . The growth rate of refined oil consumption this year is very high. Although high oil prices have driven consumption growth by 5% , they have put certain pressure on the auto market. The impact of chip shortages on the auto market has improved, but the impact of the epidemic has intensified, and the effect of production improvement has gradually weakened since the fourth quarter of last year .

At present, the relationship between automobile sales and real estate sales in 2022 is 53 square meters of housing: 1 car, and the sales volume comparison is more prominent, which is an improvement from the highest point of 70 square meters per car in 2020. The demand for the auto market is seriously depressed compared with the real estate market. As the only consumer product that is not popular in urban and rural families in China, the overall trend of the national passenger car market has not been strong in recent years, and passenger car consumption has continued to be sluggish, making it difficult to effectively drive the high-quality development of residents' production and living consumption. To promote auto market consumption, more measures are needed, such as bringing cars to the countryside, halving the purchase tax, reducing personal income tax for car buyers, and encouraging marriage and car purchases, to stimulate consumption and promote economic growth.

1. Car consumption is low in May 2022

In 2021 , the total retail sales of consumer goods reached 44,082.3 billion yuan, up 12.5% ​​year- on-year, with an average growth rate of 3.9% over the past two years . Among them, the retail sales of consumer goods other than automobiles reached 39,703.7 billion yuan, up 12.9% . Automobile consumption reached 4,378.7 billion yuan, up 7.6% .

In May , the total retail sales of consumer goods was 3354.7 billion yuan, down 6.7% year-on-year . Among them, the retail sales of consumer goods other than automobiles was 3036.1 billion yuan , down 5.6 % . From January to May , the total retail sales of consumer goods was 1716.89 billion yuan, down 1.5% year-on-year . Among them, the retail sales of consumer goods other than automobiles was 1550.95 billion yuan, down 0.5% .

Auto consumption was relatively sluggish in 2018-2019 , with entry-level consumption still insufficient and mid- to high-end consumption upgrading outstanding. Auto consumption in 2020 was affected by the Spring Festival epidemic at the beginning of the year, forming a low at the beginning and a high at the end. In 2021 , the contribution of automobiles to consumption was positive, forming a high at the beginning and a low at the end. In 2022 , the volatile trend under the epidemic at the beginning of 2020 was repeated .

2. Automobile production weakened in January-May 2022

In terms of products, in May , the output of 256 out of 617 products increased year-on-year. Automobile production was 1.993 million units, down 4.8% , among which sedan production dropped significantly in May . From January to May , automobile production was 9.94 million units, down 7% , among which sedan production dropped significantly by 3.58 million units.

3. The added value of automobiles will perform well in 2022

From January to May , the added value of industrial enterprises above designated size increased by 3.3% year-on-year . In May , the added value of industrial enterprises above designated size increased by 0.7% year-on-year in real terms . Among them, the added value of automobiles in May 2022 decreased by 7% .

In 2018 , the added value of the automobile industry increased by 4.9% , and in 2019 , the added value of the automobile industry was 1.8% , which was lower than the average level of added value of the manufacturing industry . In 2021 , the growth rate rebounded to 5.5% . The added value of automobiles in January -May 2022 was -5.7% , which performed poorly.

4. Automobile production capacity utilization rate

In the first quarter of 2022 , the national industrial capacity utilization rate was 72.1% , down 6.4 percentage points from the same period last year. In 2021 , the national industrial capacity utilization rate was 74.7% , up 2.3 percentage points from the previous year.

The capacity utilization rate of the automobile industry has continued to decline in the first three quarters of 2021 , reaching around 76% in the fourth quarter , reflecting the huge losses caused by production suspension due to chip shortages in the third quarter.

The improvement in the automobile industry's capacity utilization rate in the first quarter of 2022 was still small. The production capacity losses caused by epidemic prevention and control were huge, especially the losses in the industrial chain were very serious. Corporate confidence was extremely weak, and the impact on consumption was also obvious.

5. New energy vehicle production in May

In the past two years, commercial vehicles have been strong and passenger vehicles have been weak. In 2021 , the automobile production volume was 26.53 million units. The consumption structure is further unfavorable to consumption. The production growth rate of sedans is low, weaker than the average growth rate of automobiles, and the production growth rate of SUVs is lower than the overall growth rate of automobiles, which has become a sluggish factor that suppresses consumption.

In 2018 , 1.3 million new energy vehicles were produced , a 40 % increase over 2017. In 2018 , 1 million new energy passenger vehicles were produced, continuing the strong high growth trend. In 2019, 1.19 million new energy vehicles were produced , with a growth rate of -1% , which was weak.

From January to May 2022 , 9.94 million vehicles were produced , with a year-on-year decrease of -7% , and 2.18 million new energy vehicles were produced, an increase of 112% . In May , 1.99 million vehicles were produced, a year-on-year decrease of 5% ; 500,000 new energy vehicles were produced , a year-on-year increase of 108% , and the penetration rate was 25.1% , which is a very high growth.

6. Negative growth in automobile investment in May 2022

The hot property market from 2016 to 2019 had a great impact, and the gradual cooling in the later period promoted the auto market well. In 2021 , the sales area of ​​commercial housing was 1794.33 million square meters, an increase of 1.9% over the previous year; an increase of 4.6% over 2019 , and an average increase of 2.3% over the past two years . From January to May 2022 , the sales area of ​​commercial housing was 507.38 million square meters, a year-on-year decrease of 23.6 % , of which the sales area of ​​residential housing decreased by 28.1% ; the sales of commercial housing was 483.37 billion yuan, a decrease of 31.5% , of which residential sales decreased by 34.5% .

At present, the property market will gradually decline from January to May 2022 , and sales in the eastern region will be good. This is also the last way for real estate to reap the benefits. The current income of residents cannot support continued high debt, so the cooling of the property market is conducive to the development of the auto market.

Currently, the relationship between automobile sales and real estate sales in 2022 is 53 square meters of house: 1 car. The sales volume comparison is more prominent, which is an improvement compared with the highest level of 70 square meters per car in 2020. The demand in the automobile market is severely sluggish relative to the real estate market.

Real estate loans have shrunk significantly, and property market investment is mainly supported by residents' deposits and prepayments, which has a certain diversion effect on car purchase funds in the auto market.

The wealth effect of the real estate market has a certain promoting effect on the demand for high-end cars, and the recent decline in debt pressure in the real estate market also brings certain potential benefits to consumption.

8. The auto market needs continued policy support in 2022

In 2021 , the total retail sales of consumer goods reached 44,082.3 billion yuan, up 12.5% ​​year- on-year, with an average growth rate of 3.9% over the past two years . Among them, the retail sales of consumer goods other than automobiles reached 39,703.7 billion yuan, up 12.9% . Excluding price factors, the total retail sales of consumer goods in 2021 actually increased by 10.7% over the previous year .

From January to May , the total retail sales of consumer goods was 17168.9 billion yuan, down 1.5% year-on-year . Among them, the retail sales of consumer goods other than automobiles was 15509.5 billion yuan, down 0.5% .

At present, the problem of sluggish consumption has improved. Automobile consumption in the first quarter was -0.3% , especially in May , the growth rate was -16% , which is still relatively weak. In the future, automobile consumption should gradually pick up to support the overall consumption growth. In May , the total retail sales of consumer goods was 3354.7 billion yuan, a year-on-year decrease of 6.7% . Among them, the retail sales of consumer goods other than automobiles was 3036.1 billion yuan, a decrease of 5.6% . This shows that automobile consumption reflects consumer confidence and needs to be effectively boosted.

This year's refined oil consumption is relatively high, which is also the loss of sales of automobile consumption. In the overall social retail, the retail sales of goods above the limit performed strongly, which is the first reversal in recent years, reflecting that refined oil consumption has a good effect on promoting overall bulk consumption.