China leans on auto subsidies to jump-start post-virus economy

Ownership caps will be eased as car sales plunge in first quarter

20200406N China dealership

Car dealerships in Beijing, seen here in a Feb. 27 photo, and the broader industry have been hit hard by the outbreak, with China's auto sales in the first two months of the year dropping 37%. © Reuters

SHUNSUKE TABETA, Nikkei staff writer

BEIJING -- After declaring victory on stemming the coronavirus outbreak, China aims to stimulate depressed consumption with subsidies for auto purchases and looser caps on car ownership.

Auto sales in China plummeted 45% in March from a year earlier, according to an industry group, following a 37% decline for January and February. The auto industry makes up 10% of the country's gross domestic product.

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