China's auto stockpiles fall

China's average automotive stockpiles fell to a four-month low as carmakers shut factories for summer maintenance.

The China Automobile Dealers Association claimed average stockpiles at automobile dealerships fell to a four month low in July. According to deputy secretary Luo Lei, inventory levels fell to the equivalent of 1.7 months of sales in July, from 1.98 months in June. Luo predicted stockpiles would fall to around 1.5 months, or 45 days, of sales for the full year.

The association believes problems with over-stocking have come about thanks to the lack of purchase incentives or overly optimistic sales targets. A small reduction in inventories, which were backed-up for an average of two months in May, might spell light relief for the nation's auto industry.  However, Pang Da Chairman, Pang Qinghua, said in a recent conference that: “supply and demand is in serious imbalance.”