China's Car Sales Rise in May, but Price Wars Cloud Outlook
Sales grew 13.9% from a year earlier to 1.96 million vehicles last month, slowing from 14.8% growth in April, China Passenger Car Association (CPCA) data showed on Monday.
Sales of electric vehicles and hybrids rose 28.2% year on year, down from a 33.9% gain in April.
Leading EV maker BYD reported decelerating annual passenger vehicle sales growth to 14.1% last month from April's 19.4% despite a new round of subsidies and incentives late in the month.
Other major automakers, including Geely and Chery, also reported slower growth as the industry's attention shifted to price wars that have raised concern over a potential market shakeout.
Authorities have warned that such price wars threaten the industry's long-term health, with the sentiments echoed by leading manufacturers such as BYD, Chery and Xiaomi.
The CPCA's secretary-general, Cui Dongshu, said the industry should focus on quality and technology innovation and that leading automakers should lower their sales targets for this year.
CPCA data also showed that car exports rebounded, rising 13.5% year on year in May, reversing a 2% decline in April.
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