Chinese auto sales declined almost 14 percent in February, an industry group announced Monday, marking the eighth straight month of year-on-year decline in the world's biggest vehicle market.
Auto demand in China surged for years as the country experienced decades of economic development that created rising consumer class. But annual sales fell last year for the first time in about two decades as growth in the world's second-largest economy slowed and uncertainty due to the trade war with the United States damaged sentiment.
As part of efforts to boost its slowing economy, China announced last week a set of measures to stimulate growth. Those included tax cuts that could help boost demand for autos, but the effect is likely to take time, analysts said.
Citi said in a Monday note that the timing of the planned tax cuts to boost consumer spending remains unclear and thus "will cause buyers to delay car purchases until after the tax is implemented."
Autos sales are an important barometer of the health of Chinese consumer spending and thus the broader economy, and they're also a key factor for foreign automakers who have hoped China's demand can help support the global auto sector.