General Motors Company (NYSE:GM) reported a drop in sales in the company’s division in China. This is as a result of a drop in the demand for the company’s Chevrolet and Buick brands.
In total, General Motors and all its partners sold 258,484 automobiles in the Chinese market. The automotive began reporting retail measures from dealers rather than from sales as it used to do previously. The switch took place a month ago. Sales dropped by 0.8% in January and February.
The shortfall in sales is one of the recent indicators of falling demand in China which is one of the biggest automobile markets in the world. China has recently been experiencing slow economic growth, and foreign companies are beginning to feel the effects. Foreign vehicle manufacturing companies like GM are suffering from the resultant pressure. Local manufacturers on the other hand have been benefiting from this phenomenon because their products are cheaper and thus the preference for home market vehicles.
Lin Huaibin, who is an analyst from a research company called IHS Automotive based in Shanghai confirmed the news with a statement reporting slow progress for foreign firms. Chevrolet sales went down by 5.6% one month ago while Buick deliveries dropped by 8.5% as reported by General Motors. Vehicle sales from Wulling brand that is one of GM’s ventures also dropped in demand by 5.1%.
Regardless of the decreasing demand for most of the foreign vehicles, an exceptional few continue to experience growing demand. The demand for Cadillac automobiles went up to 6,197 automobiles, making a rise of 4.6%. All in all, prominent vehicles seem to be outpacing the market growth. Sales figures for these vehicles went up by 19% within the first quarter in 2015.
China’s automobile market continues to grow more competitive as the most prominent brands fight for opportunities to establish themselves. Coupled with the slow economic growth, the industry is growing tougher by the day. Despite the discouraging aspects, General Motors Company (NYSE:GM) has plans to invest $16 million in SAIC Motor Corporation in the country to boost its market share.
