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In December, heavy-truck sales totaled 53,000 units, down 52% year on year, with full-year sales settling at 1.39 million units.

According to the latest data from First Commercial Vehicle Network, in December 2021, China’s heavy-truck market is expected to have sold 53,000 units across all models (based on invoicing figures), up slightly by 4% month-on-month but down 52% year-on-year. This marks the lowest December sales level in the past six years (2016–2021), marginally higher than the November 2021 trough of 51,100 units, yet roughly 56,000 units lower than the same period last year.

Release Date:

2022-01-19

According to the latest data obtained by the First Commercial Vehicle Network, In December 2021, China’s heavy‑truck market is expected to have sold 53,000 units across all models (based on invoicing data), up slightly by 4% month over month but down 52% year over year. This marks the lowest December sales level in the past six years (2016–2021), marginally higher than the November 2021 trough of 51,100 units, yet roughly 56,000 units lower than the same period last year. December also marked the eighth consecutive monthly decline for the heavy‑truck sector since the start of 2021. Following December, the market has posted year‑on‑year drops exceeding 50% for five straight months, from August through December. As shown in the chart, the red line representing 2021 remained at the top through January and into April. Starting in May, sales began to fall, with the red curve slipping below the yellow line for 2020. In the second half of the year, as demand and order intake in the heavy‑truck industry deteriorated rapidly, monthly trends turned sharply downward: July saw a 45.2% year‑on‑year decline; August’s drop widened to 60.5%; and in September and October, what had once been dubbed “Golden September, Silver October” became “Copper September, Iron October,” with year‑on‑year declines of 60.7% and 61.1%, respectively. By November, overall heavy‑truck sales were down 62.3% compared with the same month a year earlier, hitting the lowest monthly level of 2021. Although December’s year‑on‑year decline narrowed by 10 percentage points, this was not indicative of a market recovery; rather, it reflected the relatively low base of the prior-year period.

After December, the full-year sales figures for the 2021 heavy-truck market were finalized at approximately 1.39 million units, down 14.1% from 1.62 million in 2020. While this total represents the second-highest level on record—surpassed only by 2020—the market conditions deteriorated sharply in the second half of the year, with the bulk of annual sales concentrated in the first half, which accounted for roughly 75% of the year’s total.

Monthly sales trend of China’s heavy-duty truck market, 2015–2021 (unit: vehicles)

According to an earlier analysis by the First Commercial Vehicle Network, domestic heavy-truck sales have experienced a sharp, sustained decline since the second half of the year, driven by a confluence of adverse factors, including weak demand in the logistics and infrastructure‑construction sectors, front‑loaded demand, and elevated inventory levels. The result of “squeeze.” First, the logistics and transportation market is characterized by an oversupply of trucks and a shortage of cargo, leading to weak demand for new vehicle purchases. Starting in the latter half of the second quarter of 2021, both the logistics and transportation sector—upstream from heavy‑truck sales—and the infrastructure construction industry began to decline, with the downturn intensifying in the second half of the year. Coupled with the rapid growth in the number of heavy‑truck vehicles over the past few years, this has given rise to a host of problems, including insufficient freight volumes, an excess of trucks relative to available cargo, overcapacity, and depressed freight rates, all of which have severely dampened new‑truck sales in the market.

Secondly, the transition to stricter emissions regulations has led to an early depletion of market demand. Due to… Effective July 1, 2021, the China VI emission standard for diesel vehicles was implemented nationwide. Consequently, in a rush to meet the demand for China V‑compliant trucks, most heavy‑truck manufacturers, component suppliers, and dealers vigorously competed for market share in the first half of the year. Many customers also purchased China V‑compliant new trucks ahead of schedule, boosting first‑half sales but effectively “front‑loading” demand and depleting second‑half market potential. Third, inventory levels remain excessively high. With end‑user orders and overall demand falling far short of expectations, a substantial portion of China V‑compliant heavy trucks produced in the first half are now stockpiled at dealerships—ranging from vehicles registered early to those with sales invoices issued prematurely—resulting in elevated industry inventories. Coupled with the steadily rising stock of China VI‑compliant trucks, total industry inventory remains at an elevated level, which is clearly detrimental to new‑truck sales. Based on the current situation, it appears that these high inventory levels may not begin to ease until the first half of 2022.

( Article reprinted from: China Commercial Vehicle Network )