China's Auto Market Slumps in July; NEV Sales Rise

Auto stocks mostly in red on Wednesday on news of the third consecutive month of declining sales in China.
Aug. 11, 2021 22:21
China's Auto Market Slumps in July; NEV Sales Rise

Chinese auto stocks were in the red Wednesday on reports of a declining market. The China Association of Automobile Manufacturers (CAAM) has released data for July showing a third month of declining vehicle sales.

According to the report, auto sales last month were down 11.9% year-over-year, at 1.86 million in the world's largest auto market. That sent the stock of auto marketplaces Kaixin Auto (Nasdaq: KXIN), Cango Inc. (NYSE: CANG), and Uxin Ltd. (Nasdaq: UXIN) down 5%, 2%, and 1%, respectively.

However, new energy vehicle sales surged 164% in July to 271,000, CAAM showed; these included battery-powered, plug-in hybrid, and hydrogen fuel-cell vehicles.

Still, some Chinese EV stocks also ended in the red. These were Nio Inc. (NYSE: NIO), down about 1%, and XPeng Inc. (NYSE: XPEV), which tumbled early in the day but recovered somewhat, to close the day 8 cents lower. Li Auto Inc. (Nasdaq: LI) closed 1% higher after an early stride to red territory. Last week, the three EV makers reported July deliveries, with XPeng and Li Auto overtaking Nio in numbers.

Another top Chinese automaker, Warren Buffett-backed BYD Co. Ltd. (OTC: BYDDF; HKEX: 1211), ended 1% lower in Hong Kong and 12 cents higher in OTC. In July, BYD's new electric vehicle sales tripled to 50,492 compared with 15,100 a year ago.

Meanwhile, Tesla Inc. (Nasdaq: TSLA) closed 0.3% lower, at $707.82 per share, on Wednesday. Its EVs were not enjoying the same high demand. Tesla sold 8,621 units in China in July, a 26% decline year-over-year and 69% lower than in June, according to the China Passenger Car Association (CPCA). For the American automaker that was a first decline since January 2020, as pointed out by the Financial Times.