Taiwan auto shares decline 3.5% despite impressive March sales

The China Post - Taiwan's auto shares tumbled yesterday, despite the fact most major automakers reported stellar March sales on Monday. 

By closing, Yulon Motor was down 3.45 percent to NT$56; China Motor closed down 4.5 percent to NT$24.4; Yulon-Nissan closed down 2.25 percent to NT$114.5; and Hotai Motor closed down 0.69 percent to NT$86.6.

Altogether, the automobile stock category fell 3.5 percent, whereas the benchmark TAIEX closed down 147.68 points to 8,732.59.

The nosedive came despite all major carmakers reporting impressive March and first quarter figures due to strong demand on Monday.

Consumers were on a buying spree fearing the March 11 earthquake in Japan would cause production disruptions in the months to come.

For March, new car sales totaled 35,000, according to statistics. Hotai's March new car sales were 1.5 times those of February, whereas China Motor and Yulon-Nissan had month-on-month sales increases of 63 percent and 47 percent, respectively.

Last month, Hotai, which distributes Toyota-branded cars in Taiwan, posted sales of NT$8.239 billion, an increase of 45.5 percent from February. China Motor, a distributor of Mitsubishi automobiles, posted March sales of NT$3.632 billion, a rise of 63.2 percent from February.

Yulon-Nissan reported March sales of NT$2.843 billion, a rise of 41.3 percent month-on-month, and Yulon Motor posted sales of NT$3.557 billion, a rise of 56 percent from February.

However, sales tumbled during the first ten days of April, according to a report by United Evening News yesterday, citing unnamed sources.

The paper said from April 1 to 10, new car sales totaled 2,854, a decline of 57.4 percent from the same period in March and 26.2 percent from the same period last year.

The decline played a key role in yesterday's sell-off of auto shares, analysts said.