Chinese ministry vows targeted policy support in nationwide campaign to boost auto sales

The Chinese Ministry of Commerce (MOFCOM) announced on Thursday that it will organize promotional activities across the country to boost auto sales in the second half of the year, vowing, among others, targeted policy measures to support auto consumption. 

As part of the campaign, which is scheduled to run from June to December, localities will coordinate and plan auto consumption promotion activities and based on local recommendations, MOFCOM will select 100 cities with distinctive features and complementary advantages for major activities. 

The activities will also focus on boosting consumption in the whole supply chain of the auto industry, including new vehicle sales, second-hand vehicle sales, upgrades and the automotive aftermarket, according to a notice issued on Thursday. Activities will also be organized in many counties and townships across the country to promote sales of new-energy vehicles, MOFCOM said.

Policy support for auto consumption will also be enhanced. MOFCOM will coordinate and promote the introduction of targeted policies and measures to support auto consumption by local governments and enterprises, give full play to the role of local fiscal funds, and encourage financial institutions to introduce financial support measures for auto credit, the notice said. 

Amid China’s economic recovery this year, auto consumption has become a major part of the country’s effort to boost domestic consumption – the biggest growth driver. A slew of measures have been announced to boost auto sales. For example, the National Development and Reform Commission (NDRC) said it would ramp up drafting of policies to boost consumption, with a focus on the auto and housing sectors. 

Meng Wei, spokesperson for the NDRC, said that as auto consumption is a "big driver" of overall consumption, the NDRC will speed up the construction of charging piles and urban parking facilities, as well as encouraging auto companies to develop models more suitable for use in rural areas.

In the first four months of 2023, China’s auto output increased by 8.6 percent year-on-year to about 8.36 million units and sales rose 7.1 percent year-on-year to about 8.24 million units, according to the latest data released by the China Association of Automobile Manufacturers.