Shanghai (ZXZC)- China's vehicle inventory alert index (VIA), which reflects the inventory pressure on automobile dealers, dropped 3.7 percentage points month on month in Feb. 2023, according to the China Automobile Dealers Association (CADA).

The VIA stood at 58.1% last month, climbing 2 percentage points from the previous year.

The index in Feb. 2023 was still above the official warning threshold (50%).

February in previous years was usually an off-season for auto production and sales in China, as the Spring Festival holiday often fell in this month. This year, the automotive market in February was slightly better than the same period in previous years, but the numbers were still below the expectations of automotive dealers due to such factors as the to-be-finished policy overdraft effect and fewer workdays, said the CADA.

In Feb., the demands in the auto market after the holiday season took a favorable recovery, and foot traffic at dealers’ showrooms increased significantly compared to January. Many automakers adjusted their sales prices, thus promoting their terminal sales, the association added.

It is expected that the China’s overall auto market in February would be stable, with retail sales of passenger vehicles at around 1.4 million units.

In Feb. 2023, the VIAs of imported & luxury brands and mainstream joint-venture brands stood at 56.5% and 56.8%, dropping 3 and 8.9 percentage points over a month ago, respectively. Nonetheless, Chinese locally-owned brands’ monthly index jumped 11.4 percentage points from Jan. 2023 to 64.9%.