China's June car sales fell 6.9% from a year earlier, extending declines for a third straight month as government incentives failed to spur consumer demand in a sputtering economic recovery.
Passenger vehicle sales totalled 1.78 million in June, with the pace of decline picking up from a 2.2% drop in May and a 5.8% fall in April, China Passenger Car Association data showed on Monday.
A cut-throat price war since 2023 helped to lift China vehicle sales earlier in the year but is having less effect in recent months despite fresh government subsidies for trading in cars, which were announced in April.
For the first half overall, China's car sales were up 2.9% at 9.93 million vehicles.
June sales of so-called new energy vehicles including pure electric vehicles and plug-in hybrids accounted for a record 48.1% of domestic car sales.
Chinese electric vehicle giant BYD (002594.SZ), and relative newcomers such as Nio (9866.HK), Zeekr (ZK.N) and Leapmotor (9863.HK) all logged record monthly sales.
Overall growth in electric vehicle sales cooled to 9.9% from 27.4% in May while sales of plug-in hybrids jumped 67.2%, up from a 61.1% increase the previous month.
June car exports were up 28% year on year, against a 23% gain in May, according to separate data from the association.
The trend for exports could weaken, however, after the European Commission last week confirmed provisional import tariffs of up to 37.6% on Chinese-manufactured electric vehicles.
U.S. electric vehicle manufacturer Tesla exported 11,746 Chinese-made vehicles in June, its lowest since October 2022.
Underscoring weakness in consumer demand, a vehicle inventory alert index compiled by the China Automobile Dealers Association rose by 8.3 percentage points year on year to an alarming 62.3% in June.
