The number of passenger cars produced in February rose 29.0 percent year-on-year to 1.25 million units, while the sales volume was up 22.3 percent to 1.09 million units, reports China Securities Journal, citing the China Passenger Car Association (CPCA).
Sales at retail outlets were significantly below that of automakers and the wholesale volume, and the CPCA forecasts a year-on-year negative growth in auto sales volume in March.
The wholesale volume was 1.21 million units in February, up four percent from January, while sales at retail outlets fell 6.7 percent to 1.09 million units.
The greater number of working days this February compared with last year was the major driver for the improvement in the production and sales figures, said the CPCA.
In addition, with an increasing number of farmers starting their own businesses, this led to a growth in the sales of micro passenger vehicles.
The rise in gasoline prices in February had impacted auto sales, leading to production and wholesale volumes topping the retail sales volume, added the CPCA.
China recently published guidelines on the procurement of government vehicles, which stipulated that autos purchased by the government must be from companies which spend more than three percent of sales revenue on research and development.
A great number of the auto joint ventures failed to meet the requirement as they mainly manufacture cars in China, with no focus on research and development.
According to the CPCA, the procurement volume of the government is only 200,000 passenger cars per year.
Shares of FAW Car (000800) inched up 0.09 percent to close at 11.61 yuan per share today.

Source:capitalvue.com