Business appears to be slow at the Mercedes-Benz showroom in the Jing'an district of Shanghai.
There are no customers and the staff look bored. A family comes in to look at the cars but appears to have no intention of buying. A salesperson is tight-lipped when asked whether they are seeing fewer customers through the doors.
Car sales in China are slowing after years of rapid growth, and have slumped in the past few weeks. According to the China Association of Automobile Manufacturers, numbers sold in June fell 5.3 per cent from May; this drop coincided with the stockmarket crash that saw the Shanghai Composite Index lose 14 per cent in July. The association previously estimated that sales would grow 7 per cent this year, now it thinks that figure will be only 3 per cent.
A number of international car manufacturers such as Peugeot, Citroen and Ford have warned of sluggish sales in China, while Audi lowered its global sales forecast last week because of falling demand there. State media reports that some companies have been cutting prices since April in an effort to boost sales.
Bill Russo, managing director of management consultancy Gao Feng Advisory Company, confirms that the sector is slowing down. The recent stockmarket crash is "noise in the system", he says, but admits that "there could be a short-term impact".
