(Yicai Global) May 8 -- A key benchmark that reflects inventory pressures on China's car dealers spiked last month, staying above its warning level for 16 months in a row and indicating a further weakening in demand in the world's biggest auto market.
The Vehicle Inventory Alert Index climbed 6.5 percentage points from a year ago to 61 percent in April, according to the findings of a survey the China Automobile Dealers Association published in a report yesterday. The headline figure was 5.7 points higher than in March. An increase implies slowing demand and greater risk.
The data show that vehicle sales are slumping and both carmakers and dealers are under increasing pressure, industry insiders said in the report.
Last year, China posted its first slowdown in car sales in nearly two decades. The slump has shown no signs of easing so far this year, with sales dropping for a 10th month in April.
Various factors caused April's decline, while trade shows did not manage to buoy the market, Securities Daily reported, citing CADA Deputy Secretary-General Lang Xuehong. An annual international auto show was held in Shanghai last month.
More than half of dealers expect average business dealings this month, while nearly a third think business will be poor, the survey found. About a 10th of respondents believe prospects are good.
Editor: Emmi Laine