China’s Vehicle Inventory Alert Index falls 10.4 percentage points YoY in July 2021

Shanghai (Gasgoo)- China's Vehicle Inventory Alert Index (VIA) stood at 52.3% in July 2021, dropping 10.4 percentage points from the previous year, while also felling 3.8 percentage points from the previous month, according to the China Automobile Dealers Association (CADA). The figure was still above the official warning threshold. 

Due to the traditional slack season for car shopping and the chip shortage, the overall market demands grew a bit slower, leading to decline in car sales last month, said the CADA. In mid- and late-July, the resurgence of sporadic coronavirus cases in regions like Guangdong province and Nanjing, the floods in central China's Henan province, and the landfall of typhoon in Jiangsu, Zhejiang provinces and Shanghai all had adverse impact on Chinese auto market.

The association also noted that car dealers' operating profits shrank in July due to the car supply constraint led by chip shortage, the extended high-temperature vacation at some car plants, the lack of some hotter-selling models, as well as the contracted discounts.

In July, the VIAs of the imported & luxury brands, the mainstream joint-venture brands, and the Chinese indigenous brands reached 50.5%, 53.7%, and 55.7%, declining 3.9, 2.4, and 3 percentage points over a month ago respectively, according to the CADA.