China's Gnarly Sales Slide Just Hit The 10-Month Mark

The Story

Plus GM is setting up a $4.5 billion safety net to avoid parts shortages, Porsche is partnering with Xpeng to help the VW meet its emissions targets and more.

In this morning’s edition, China’s car market’s sales skid just entered its tenth month, General Motors is setting up a $4.5 billion safety net to avoid future parts shortages, Porsche is partnering with Xpeng to help the Volkswagen Group meet its emissions targets and Toyota is recalling over half a million Camrys for malfunctioning gauge cluster screens.

Sales in China slid 21.1% in July from the same time a year earlier to 1.47 million vehicles. At the same time, exports rose a staggering 88.2% to 923,000 vehicles, according to the China Passenger Car Association. Electric vehicle and plug-in hybrid exports also grew — up 147.8% year-over-year, but they suffered a 3.9% domestic decline. From Reuters:.

For the first seven months of the year as a whole, domestic ​passenger vehicle sales declined 20.5%, equivalent to about 2.65 million fewer vehicles than in the same period a year earlier.

The pressure is evident among industry leaders. BYD, the world’s largest EV maker, has been grappling with a slowing home market, yet record overseas shipments in July helped lift its global sales for a third consecutive month.

Stellantis-backed Leapmotor, one of BYD’s ​fastest-growing challengers, reported global sales ⁠of more than 100,000 vehicles in July, more than double a year earlier.

One tactic Chinese automakers are pushing as they move overseas is tapping into underutilized factories owned by traditional automakers. It’s a way for them to expand production capacity and gain market access. Last month, Geely and Ford penned an agreement that let Geely build electric SUVs at a Ford plant in Spain. Still, these sorts of agreements don’t make up for the losses they’re seeing at home.

Why It Matters

Last month, Geely and Ford penned an agreement that let Geely build electric SUVs at a Ford plant in Spain.

CarMotion Daily’s Take

“Our industry has experienced significant supply chain disruptions in the past for various reasons, and it’s safe to assume they will happen in the future,” GM said. Watch this space over the coming weeks.