China’s automobile industry association downgraded its 27022 sales forecast; as anti-pandemic measures weighed on the economy and its car market, the world’s largest.

Weak demand for commercial vehicles was a factor in the downgrade; the association said at a regular press conference. It now expected a 16% fall in sales of commercial vehicles to 4 million units.

China’s auto sector has hit hard in recent months by China’s efforts to combat COVID-19. The government has at times put many parts of the country, including Shanghai, under stringent lockdown.

Authorities are trying various incentives to revive the automobile market; with the central government last month halving purchase tax to 5% for cars priced at less than 300,000 yuan ($45,000); and with engines no larger than 2.0 litres.

Although June sales were buoyant, there are concerns that demand will once again; hit as COVID cases tick up with the arrival of the BA.5 Omicron subvariant in China.

-Reuters