(Yicai Global) Feb. 22 -- Retail sales of passenger vehicles in China are expected to bounce back this month, as the lunar new year holiday is over and as new local purchase subsidies and new energy vehicle price changes gradually take effect, the China Passenger Car Association said.

Passenger car sales will likely reach 1.35 million this month, up 7.2 percent from a year earlier and 4.3 percent from January, data from the CPCA showed today. NEV sales will probably soar to 400,000, a nearly 47 percent gain from a year ago and 20 percent up on last month.

In January, 1.3 million passenger cars were sold in China, a 38 percent plunge from a year earlier and 40 percent from December, mostly because of the impact of Covid-19 and the holiday, per data from the CPCA.

Because of the expiration of national purchase subsidies for NEVs and significant adjustments in vehicle prices, some potential buyers took a wait-and-see attitude, causing retail sales of NEVs to fall 6.1 percent on the year and 48 percent on the month to 333,000 units in January.

The passenger vehicle market’s overall discount rate remained basically unchanged at 13.8 percent in mid-February from the previous month, indicating relatively stable prices.

With the continued improvement of the Covid-19 situation, consumer confidence is recovering and is expected to be back on the right track next month.

Editor: Futura Costaglione