Beijing show opens to uncertainty

Visitors inspect a BMW i4 concept car at the Beijing autoshow, a rare industry event held in person during the pandemic, which fewer people attended and where new models were scant. (Reuters)
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Updated 27 September 2020

Beijing show opens to uncertainty

  • World’s biggest car market has been hit by lockdowns that froze economic activity — but some signs of hope

BEIJING: China’s auto market has rebounded smartly from the COVID-19 crash in recent months, especially for high-end cars, but questions about the durability of that recovery hung over the Beijing autoshow that started on Saturday.

A rare industry event being held in person during the pandemic, the show marks a triumph for the world’s biggest car market, pummelled from late last year as lockdowns froze economic activity in the country where the disease erupted.

However, this show will be a far cry from the usual ebullience as fewer attend, new models are scant and prospects remain uncertain.

Among the bright spots; the Chinese market’s sharp bounce since April, strong demand for midsize to large luxury vehicles and a flood of interest — and investment — in electric vehicles.

China’s auto sales rose 11.6 percent in August from a year earlier, the fifth straight rise after plunging during the lockdown. When almost all residents were told to stay home in February, sales collapsed a record 79 percent to their lowest since 2005.

Guangzhou-based GAC, which has partnerships with Toyota Motor and Honda Motor, expects sales to grow for the full year, general manager Feng Xingya said on the sidelines of the show, formally the Beijing International Automotive Exhibition 2020.

Germany’s BMW expects “single digit growth” in China this year, said Jochen Goller, head of BMW China.

“We were heavily affected during quarter one of course, and massively in China,” with a 30 percent on-year sales drop, Goller said. But the second quarter saw a 17 percent rebound and this quarter “is running really well.”

“You can say confidence is back,” Goller said.

China’s typically busy car-buying season, “Golden September, Silver October,” is off to a good start, according to preliminary data, with passenger car sales up 12 percent in the first 20 days of September.

The rebound means this year’s sales will fall less than 10 percent, the China Association of Automo- bile Manufacturers estimates, better than its May forecast of a 15 to 25 percent decline.

Much of the upturn is driven by sales of larger passenger cars by makers such as Daimler and BMW, boosted by new models, automakers’ discounts and a broader recovery in the world’s second-largest economy.

Premium vehicles accounted for a record 15 percent of the Chinese market in August, up from around 10 percent for all of last year, said the China Passenger Car Association.

Electric vehicles are also providing a buzz to the Beijing show, as a boom in Tesla shares has propelled interest in China. EV startups like Nio, Xpeng, Li Auto and WM Motor have together raised more than $8 billion this year.

But the recent improvement reflects Chinese carmakers making earlier model launches as they could not wait for the usual hype from the delayed autoshow before going to market. That suggests a more limited upside to the current sales rise.

“This year’s auto sales are very different from previous years,” said senior LMC Automotive analyst Alan Kang. “Many cars were sold during summer because customers delayed purchases after the lockdown.”

Sales of larger sedans and sport-utility vehicles have returned to last year’s levels, but competition among mass-market brands is intensifying, said Yale Zhang, head of Shanghai-based consultancy AutoForesight.

That is a key battleground for international and domestic brands including Volkswagen, Toyota, and Geely. Still, he said, “Sales performance in these two months will give us a clue about what will happen next.”


Emirates stops flights to three major Australian cities

Updated 58 sec ago

Emirates stops flights to three major Australian cities

DUBAI: Emirates has suspended flights to Australia’s three largest cities as the country further restricts international arrivals over fears of new virus strains.
The Dubai-based carrier was one of the last to maintain routes into and out of the country’s east coast throughout most of the pandemic but on Friday evening told travelers a handful of planned flights next week would be the last.
“Due to operational reasons, Emirates flights to/from Sydney, Brisbane and Melbourne will be suspended until further notice,” Emirates said on its website.
The airline will still run two flights a week to Perth, but the cuts are another barrier for tens of thousands of stranded Australians still attempting to return home.
The Australian government responded by announcing more repatriation flights and said other carriers still flying services to the cities could fill the gap.
“The capacity that Emirates was able to use within the cap will be allocated to other airlines, ensuring that there are still as many tickets, as many seats available into Australia,” Finance Minister Simon Birmingham said.
A small number of airlines — including Qatar Airways and Singapore Airlines — are still running services to Australia but local media were already reporting delays and cancelations among returning travelers.
Australia’s borders have effectively been closed since March to curb the spread of the virus, with the government even limiting the number of citizens allowed to return.
Last week travel restrictions were further tightened, with arrival numbers slashed and all travelers into the country requiring a negative Covid-19 test before flying.
In making the changes, Prime Minister Scott Morrison cited a growing number of people in quarantine testing positive for new strains of Covid-19.
Fears that a variant of the virus from Britain, believed to be more contagious, had leaked into Brisbane from hotel quarantine triggered a snap lockdown in the city last week.
“There are many unknowns and uncertainties in relation to the new strain, and so that’s why this precautionary approach, we believe, is very sensible,” Morrison said.
Australia continues to deal relatively well with the virus, having recorded about 28,600 cases and 909 deaths linked to Covid-19 in a population of 25 million.