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Automobile sales show sign of recovery

"With the POS in place, more dealers are willing to pay slightly higher for their desired vehicles and then resell them to individual customers."

Barry Hung, Sinjang Auto Auction director

After months of losing steam, sales of new vehicles in Taiwan showed some signs of recovery, government data showed yesterday.

Figures released by the Ministry of Transportation and Communications showed that car sales last month plunged 11 percent to 25,371 units from the same period last year.

The decline was nevertheless an improvement over the previous month, when sales dropped 22 percent year-on-year to 26,374 units.

Overall, 114,504 cars were sold for the period from January to last month, representing a 19 percent drop from last year, the data showed.

"We are looking forward to a better third quarter because of a series of new model launches," said Steven Yang (楊湘泉), spokesman for Hotai Motor Co (和泰汽車), the nation's largest automaker, which sold 33,641 units during the first four months of this year.

But the market will face uncertainties in the fourth quarter, as consumer purchase sentiments will likely be affected by the year-end elections, he said.

Hotai said last week it would release a cash dividend worth NT$4.2 (US$0.13) per share to its shareholders, the highest in the sector.

In view of slow-moving sales of automobile, some vendors have switched to the second-hand car business.

Sinjang Auto Auction (行將企業), the nation's largest used-car auctioneer under Yulon Group (裕隆集團), tied up with computer maker Acer Inc to launch point-of-sales (POS) services in the middle of last month to facilitate sales of such vehicles.

The plan, which cost NT$40 million to implement, will enable all of Sinjang's approximately 800 dealers around the country to make several electronic bids for cars, leaving behind the conventional way of manual bidding.

"With the POS in place, dealers are willing to pay slightly more for their desired vehicles and then resell them to individual customers," Sinjang director Barry Hung (洪舜彥) said.

Sinjang sells used cars with a 3 percent to 5 percent upside, he said.

After the plan has gained momentum, Sinjang and Acer will bring their management know-how to the Chinese market, Hung said.

Transactions of second-hand cars in China hit 1.9 million units last year, a 31.5 percent growth and higher than new car sales for the third consecutive year, China Automobile Dealers Association (中國汽車流通協會) data showed.
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