Volkswagen Group is heavily dependent on the Chinese market (Photo: VW)
Leading market researcher IHS Automotive has reduced its 2015 forecast for new-car sales in China, predicting growth of only 1.4 pc for the year.
Earlier, IHS had expected unit sales in the world's biggest market to increase 4.4 pc from 2014 levels.
The weaker outlook, which affects many carmakers that have a large sales presence in China, reflects a slowdown in economic growth, a weaker Chinese yuan - which makes imported goods more expensive - and a recent slump in the stock market. All this, IHS said in a press statement, "suggests a significant rebound in light vehicle sales is unlikely in the coming months."
Weakness in China could force many carmakers to adjust their sales targets. Volkswagen Group, for example, reported last month that Chinese unit sales fell 5.3 pc in the January-July period to 1.9 million cars. The VW Group counts on China for almost one-third of its global vehicle sales.
IHS said preliminary data indicate that light-vehicle sales stabilized a bit in August, but theyÂ are still expected to have dropped nearly 2 pc from a year earlier. That would mark the third consecutive monthly sales drop.
In 2016, IHS analysts expect a small rebound, with sales growing 3 pc on lower car prices and reduced interest rates. A government scrappage program is also expected to help sales.
New light vehicle sales totaled 23.1 million in 2014, up 8.1 pc from 2013. In 2015, sales are expected to total 23.4 million, rising to 26.9 million by 2018.