By Trefor Moss
SHANGHAI--China's auto sales declined for the eleventh straight month in May, falling 16.4% from a year earlier to 1.91 million as the prolonged downturn in the country's automotive sector showed no sign of abating.
For the first five months of 2019, vehicle sales fell 13% from a year ago, the government-backed China Association of Automobile Manufacturers said Wednesday. Passenger-car sales were down 15.2% during the period, while sales of commercial vehicles were off by 1.3%.
Electric-vehicle sales continued to grow strongly, however, reaching 464,000 in the January to May period, up 41.5% from the previous year. With 104,000 units sold last month, EVs accounted for 5.4% of total vehicle sales.
Market saturation in China's wealthiest cities and a credit crunch in smaller cities have combined with weak confidence in the Chinese economy to depress sales since mid-2018. While some analysts expect a rebound later this year, tough new emissions regulations--which come into force across much of China on July 1--are disrupting the industry's efforts to stage a fight-back, according to officials at the manufacturers' association.
The regulations have left dealers scrambling to shift thousands of older vehicles before selling them becomes illegal at the end of this month, often by offering steep discounts. While that could deliver a temporary boost in unit sales, it is likely to worsen financial losses for auto makers already struggling in China, analysts said.
Write to Trefor Moss at Trefor.Moss@wsj.com