Growth in China’s auto sales plunged in March as demand for SUVs weakened and purchases of sedans contracted, an industry group reported Tuesday.
Sales of cars, minivans and SUVs in the biggest market by number of vehicles sold rose 1.7 percent from a year earlier, according to the China Association of Automobile Manufacturers. That was down from 6.3 percent growth in the first two months of the year.
Total vehicle sales, including trucks and buses, rose 3 percent to 2.5 million.
Auto demand was forecast to cool after Beijing raised a sales tax Jan. 1, but the March decline was unexpectedly sharp. Forecasters expect sales growth in mid-single digits this year, down from last year’s 15 percent.
A steady decline in sales growth is squeezing global brands that look to China’s crowded market to drive revenue and newer local brands that are expanding abroad.
Sales of SUVs, which are shoring up revenue for automakers as demand in other segments plunges, rose 19.6 percent from a year earlier to 832,300. Still, that was down from 21.6 percent growth in January-February.
Sales of sedans shrank 4.9 percent to 990,000 units, down from 3.8 percent growth in January-February.
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