China's vehicle sales fell in July for a third consecutive month, hurt by flooding in some areas of the country, COVID-19 outbreaks in other areas, and the global shortage of semiconductors.
The world's biggest automotive market saw sales drop 11.9% in July from the same month a year earlier to 1.86 million vehicles, according to data from the China Association of Automobile Manufacturers (CAAM).
Through the first seven months of the year, China's vehicle sales increased 19% as the market recovered from pandemic lows. CAAM said that rebound is set to peter out with sales for the rest of 2021 expected to be below year-ago levels, although the market is still expected to log growth on an annual basis.
CAAM cautioned that the global chip shortage, which has led to automakers curtailing production, is unlikely to resolve itself soon as the pandemic rages in many parts of the world.
One bright spot in July was continued strong sales of new energy vehicles, which more than doubled to 271,000 units. These include battery-powered electric vehicles, plug-in petrol-electric hybrids and hydrogen fuel-cell vehicles.
The government's promotion of greener vehicles to cut pollution has prompted electric car makers such as Nio, Xpeng and BYD to expand manufacturing capacity within China.
