JPMorgan Econ FI-China Weak domestic auto demand continued in July-109868720(1)

AsiaPacificEconomicResearch15August2024JPMORGANwww.jpmorganmarkets.comEmergingMarketsAsia,EconomicandPolicyResearchJiYan(852)2800-7673ji.yan@jpmorgan.comHaibinZhu(852)2800-7039haibin.zhu@jpmorgan.comGraceNg(852)2800-7002grace.h.ng@jpmorgan.comTingtingGe(852)2800-0143tingting.ge@jpmorgan.comJPMorganChaseBank,N.A.,HongKongBranch•AutomobileproductionfellinoyatermsforthefirsttimesinceJuly2023•Autoretailsalesvaluefellfurtheramidsoftdomesticdemand•AutoexportsremainedsolidChina’sautomobileproductionfellinoyatermsforthefirsttimesinceJuly2023.China’sautoproduction(NBS,units)fell2.4%oyainJuly(vs+1.8%oyainJune).Seasonallyadjusted,weestimatethatJulyautoproductionfell3.4%m/msa.Thesequentialgrowthtrendturnednegative,asproductionfell5.5%3m/3msaarinJuly.NEVproductionremainedsolid,rising27.8%oya,or+2.0%m/msa,byourestimate.Invalue-addedterms,automobilesectorVAIrose4.4%oyainJuly(vs+6.8%oyainJune),comparedwithoverallIPgrowthof5.1%oya.NotethatthiswasthefirsttimesinceJan-Feb2023thatautosectorVAIunderperformedtheoverallindustrialproduction.Onfixedassetinvestment(FAI),autosectorFAIgrew5.0%oyainJan-July(vs6.5%oyainJan-June),outperformingoverallFAIgrowthof3.6%oya,yetunderperformingmanufacturingFAIgrowthof9.3%oya.Retailsalesvaluefellfurtheramidsoftdomesticdemand.NBSautoretailsales(value)fell4.9%oyainJuly,followinga6.2%oyadeclinein...