Automobile export volumes remained sluggish in China from January to May despite the increase in export value, indicating the positive structural adjustment in vehicle exports, the Ministry of Commerce said on Tuesday.
China exported 33,4000 cars during the first five months, down 9.1 percent from the corresponding period a year ago. However, the export value reached $5.4 billion, up 4.2 percent and 3.6 percentage points higher than the overall foreign trade growth. Meanwhile, the unit price of car export jumped 14.7 percent.
"China's auto export mainly relies on the emerging and resource-dependent markets. Local demand in these markets dropped as the economies were hurt by the fall in oil and commodity prices. In addition, most of the local currencies underwent considerable depreciation," said Shen Danyang, a spokesman for the Ministry of Commerce.
From January to May, China's auto exports to Russia, Chile, Uruguay and Colombia fell by 76.5 percent, 11.1 percent, 26.2 percent and 24.4 percent, respectively, the ministry said.
Since the second half of last year, the real effective exchange rate of the Russian rouble, Uruguay peso and Colombia peso fell 11.3 percent, 2.3 percent and 8.8 percent, respectively. Countries including Venezuela faced a shortage of foreign exchange and hence lacked the ability to pay.
"On the other hand, other auto exporting countries such as Japan and South Korea saw their currencies depreciate against the yuan, which helped raise their export price advantage," Shen said.
Besides, in the wake of the geopolitical turmoil, China's whole-vehicle export to Algeria and Iraq tumbled 40.8 percent and 76.1 percent.
In addition, frequent trade restrictions also posed hurdles to exports. Ecuador imposed import quota restrictions, and Nigeria raised the tariffs for whole-vehicle import. China's export to Ecuador and Nigeria dropped 29.6 percent and 55.9 percent during the period.
Furthermore, many Chinese auto enterprises started to establish factories overseas and localized the production. They transformed whole-vehicle exports to spare parts exports, which in turn led to a 6.3 percent growth in spare part exports during the first five months.
For many Chinese auto companies, Africa, South America and Russia have become fertile markets for global expansion.
Chongqing Lifan Group, one of the largest private car and motorcycle maker based in Chongqing municipality in Southwest China, has been on the road for more than 20 years.
In October last year, Lifan signed a contract to build a $200 million whole-vehicle factory in Russia. This will be the third wholly-owned whole-vehicle factory for Lifan, after its factories in Uruguay and Ethiopia.
Yin Mingshan, president of Chongqing Lifan, said: "The Russian factory will assemble a full set of spare parts at first and gradually localize the whole-vehicle production in Russia. We are aiming at a capacity of 200,000 cars annually."
