The full extent of the damage caused to China’s economy by the coronavirus, COVID-19, is now starting to emerge and will be further quantified later today when data on investment, retail sales, and industrial production emerge for January and February.
But that won’t fully detail the collapse seen in February – trade data was combined for both months and while exports fell 17%, imports were only down 4%, even though there were signs of a much larger fall last month in exports as factories remain shut across much of the country.
Car sales data showed a record fall last month and that should show up in some of the sectors covered in the production data later today.
Seeing Chinese car sales have been weak since midway through 2018, the decline is not unexpected, but the size of the fall is stunning.
China’s aviation regulator released dire figures last week, saying that the industry recorded its worst financial performance ever in February.
Passenger traffic plunged 85% from a year earlier to 8.3 million people, according to the Civil Aviation Administration of China (CAAC).
Cargo traffic was down 21%.
And airlines are still struggling. Only 40% of domestic flights had resumed by last Sunday, according to the regulator.
Over 237,000 flights within China and internationally were canceled from January 24, the day before New Year started and February 27, which gives a flavour of the carnage in the aviation sector.
Vehicles sales in China plummeted 79% in February from a year ago to just 310,000 units.
It was the, the steepest yearly decline on record, as the coronavirus outbreak slashed demand.
Sales of new energy vehicles (NEVs), including plug-in hybrids, battery-only electric vehicles and those powered by hydrogen fuel cells, fell for an eighth straight month to just 12,908 (which was not unexpected).
As a result, the China Association of Automobile Manufacturers optimistically thinks vehicles sales will fall by more than 10% in the first half of the year, and around 5% over the 2020 full year.
That’s if the outbreak is effectively contained before April. Vehicle sales should return to normal in the third quarter.
On average, car sales fell to 7,100 units a day during the month compared with 45,000 units per day in February 2019. However, average daily sales improved toward the end of the month, to around 16,000 units per day in the fourth week from 811 units per day early in the month.
Reports suggest that the passenger car sales in China had slid nearly 41% through the first two months of 2020, reflecting the largest sales decline in two decades.
