Shanghai (ZXZC)- China's vehicle inventory alert index ("VIA"), which reflects the inventory pressure on automobile dealers, declined 7.3 percentage points month on month in June 2022, according to the China Automobile Dealers Association (CADA).

The VIA stood at 49.5% last month, sliding 6.6 percentage points from the year-ago period. Notably, the index was below the official warning threshold (50%).

The auto market in China posted a faster recovery as the demands were rising thanks to the efficient epidemic prevention and control, as well as the implementation of such policies as tax breaks, subsidies offered by local governments and automakers, and other measures to boost sales.

The CADA predicted that retail sales of locally-made passenger vehicles (merely referring to cars, SUVs, and MPVs) would be around 1.75 million units in June, rising 5% year on year.

The sub-index for inventories, market demands, and average daily sales in June all rose compared to the previous month. As consumer confidence was shored up by frequent roll-out of incentive policies, the dealerships’ showroom traffic and turnover in June evidently grew over a month ago.

In June, the VIAs of imported & luxury brands, mainstream joint-venture brands, and Chinese indigenous brands reached 44.8%, 51%, and 53.4%, dipping 10.2, 6.5, and 3 percentage points over a month ago, respectively, according to the CADA.