China Implodes! Someone Call Glenn Beck!

New car sales in China imploded in January. This will be the message when the official data by the CAAM are announced. Which should happen any minute. The signs are ominous: Yesterday, GM China, TTAC's in-house leading indicator, announced (in a way) that sales in January had been down by 8 percent. Then, China's largest carmaker SAIC said that its January was down 8.5 percent. Today, the China Passenger Car Association told China Daily that the car market in China had nosedived16.5 percent from a year earlier to 1.17 million units in January. Late in the afternoon in Yokohama at Nissan's quarterly earnings conference, Nissan's Corporate Vice President, Joji Tagawa proudly pronounced that Nissan sales "declined only 16 percent" in China, while the Chinese car market as a whole registered "a negative 28 percent," and isn't that wonderful? Whoa!!!! What's going on? Is the sky over China finally falling? It sure looks like it. Unless you are one of the 1.3+ billion chosen few who own a Chinese calendar. Then you would know that for the better part of January, China was closed. It happens every year. A phenomenon called Chinese New Year causes hundreds of millions to travel, to set off fireworks, and to paralyze commerce for weeks on end. Officially, Chinese New Year started on January 2012 and lasted a week. Unofficially, it can last a month. Picture Thanksgiving, Christmas, Easter, Hanukkah and Ramadan all rolled into one, and you'd be covering only a tiny part of what is Chinese New Year. Now comes the really interesting part: Last year, Chinese New Year fell into February. With the result that February 2011 was a dud, car-wise, after January had been stellar.  This time around, we compare an emaciated January with a prior year January on steroids. Next month, it will be different, when sales will be compared to the dud month in the prior year. Which causes Rao Da, secretary-general of the passenger car association to glibly remark that he expects an increase of around 30 percent in February. All I can recommend: Ignore any numbers coming from China in January or February, especially percentages. from The Truth About Cars http://www.thetruthaboutcars.com

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