China's Auto Sales Bounce Back (Kind Of) After Tax Cuts

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Good Morning! Welcome to The Morning Shift, your roundup of the auto news you crave, all in one place every weekday morning. Here are the important stories you need to know.

1st Gear: China Gets A Boost

China’s economic downturn this year and subsequent slowing of auto sales has been a huge gut-punch to automakers across the world, since they basically considered the world’s biggest and fastest-growing car market to be a magical golden goose that would never stop laying eggs. Then it did, and they got caught with their pants down.


But Bloomberg reports a recent car-purchase tax cut is having a positive effect on sales:

Wholesale deliveries of sedans, SUVs and multipurpose vehicles climbed 13 percent to 1.94 million vehicles in October, according to the state-backed China Association of Automobile Manufacturers. Chinese carmakers outperformed the market, and boosted their share of sales by 2.1 percentage points from a year earlier.

[...] Great Wall, the biggest seller of SUVs in China, boosted October sales by 14 percent. General Motors Co., Ford Motor Co. and Hyundai Motor Co. also reported gains in their October deliveries, reversing recent declines. The tax cut, which was effective Oct. 1 and covers about 70 percent of autos sold in China, is effective through the end of next year.


2nd Gear: Russia Still Sucks Also

One more from Bloomberg: thanks to sanctions and dropping oil prices, the car markets in Russia continue to be even more dire.

Russian car sales fell more than forecast in October, plunging for a 10th consecutive month and forcing car makers to adjust production plans.

Sales of new cars and light commercial vehicles contracted 38.5 percent from a year earlier after a 29 percent drop in September, the Association of European Business in Russia said in a statement on Tuesday. That was worse than the median of six estimates in a Bloomberg survey for a 33 percent decline.


3rd Gear: VW Says Investigation Will Take Time

Yes, Volkswagen knows that you, the angry public, want their diesel-cheating executives’ and engineers’ heads on a platter as soon as possible. But speaking to Reuters, one official reiterated that the investigation—and most importantly, finding a fix for the cars—will take a while.

Volkswagen (VOWG_p.DE) has dampened hopes for quick results from an investigation into its rigging of diesel emissions tests and said developing a fix for the affected cars rather than finding the root cause of the manipulations is its top priority.

“I understand the desire for speed, but what matters to us instead is to work thoroughly and to not give out false premature results,” VW brand sales chief Juergen Stackmann said at a panel discussion late on Tuesday.


Enjoy your gift cards in the meantime. Go buy the new Fallout or something.

4th Gear: BMW Up Despite Mini Decline

Good sales news in October for BMW, despite a slowdown for Mini. Automotive News attributes that a decline in sales of the Countryman, their best-selling model but also an aging one due for a replacement next year:

Sales of BMW brand vehicles rose 6.3 percent to 164,915 in October, offsetting an 8.5 percent drop to 26,392 in Mini’s volume. Financial analysts Evercore ISI said weak sales of the Countryman hit the brand’s volume.

BMW said it expects Mini sales to pick up when the new Clubman is available. The Clubman starts to arrive in showrooms at the end of the month, the company said.


5th Gear: All The EcoBoosts

If sales numbers are to be believed, Ford’s big bet on turbocharging (the patented “EcoBoost” technology!) is paying off pretty well. From The Detroit News:

Ford Motor Co. this year is on track to sell more than a million cars with EcoBoost engines in the United States for the first time in a single year.

The turbocharged engine debuted as a 3.5-liter V-6 on the 2009 Taurus SHO. Since then, it’s grown to include seven different engine sizes that can be found on every Ford light-duty passenger vehicle except for the C-Max hybrid.

Savvy marketing, government fuel economy regulations and customer desire for more efficient engines have driven its popularity, analysts say.


Reverse: Them Duke Boys


Neutral: When Does China Recover?

Automakers have already adjusted their production plans to account for China’s downturn. Will the country’s auto market bounce back or are the days of insane sales numbers over?


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