Shanghai (ZXZC)- China's domestic passenger vehicle ("PV") retail sales are anticipated to reach 1.73 million units in May 2023, which should climb 6.6% from the previous month, and also leap 27.7% from the previous year mainly due to the impact of the year-ago epidemic factors and supply chain disruptions, according to the China Passenger Car Association ("CPCA").

For clarity, the passenger vehicles hereby refer to the cars, SUVs, and MPVs locally produced in the world's largest auto market.

During the May Day holiday, auto exhibitions were held intensively and manufacturers offered generous discounts combined with local promotional expenses, resulting in a strong start in May, said the CPCA. Besides, the implementation of the postponed RDE policy eased the pressure on manufacturers to clear inventory, contributing to the overall stabilization of the automotive market.

However, after the May Day holiday, terminal customer traffic and orders declined as some of the early-month demand was already fulfilled, leading to a significant decrease in market enthusiasm.

The daily PV retail sales for the first and second weeks of May 2023 reached around 53,600 units and 47,300 units on average, surging 67% and 44% from the year-ago period, respectively, according to the CPCA’s data.

After the May Day holiday, there was a slight decline in car shopping enthusiasm. The daily average retail sales for the third week are expected to be 53,000 units (+29% YoY, -2% MoM), while for the fourth and fifth weeks, the daily number are estimated to be 72,500 units, showing a slight decrease compared to April.