In March, a top industry association urged the auto industry and authorities to cool the ‘price-cut hype’ to ensure the healthy and stable development of the industry.The Friday statement aimed at encouraging automobile consumption echoed this. “Localities must not roll out protectionist policies and avoid vicious competition,” it said.
A separate statement on supporting sales of electronics products said authorities would encourage scientific research institutes and market entities to actively apply domestic artificial intelligence technology to improve intelligence levels of electronic products. The measures echoed similar ones announced by authorities in recent months and failed to boost the market, with shares in China’s automobiles index down 0.3 percent and the electronics index falling 0.6 percent against a 0.1-percent rise in the benchmark index.
“These supports will unlikely significantly boost consumption when people are still generally reluctant to spend as they lack confidence in the economic recovery,” UBS said in a note on Friday. Investors have said they are disappointed by China’s weak second quarter growth and want to see stronger stimulus, with some pinning their hopes on the Politburo meeting later this month.