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PINGDINGSHAN, China (Reuters) – When Cao Jun, 40, an engineer from the central Chinese city of Pingdingshan, takes his old, grey MG 3 car to be serviced he always steals a few moments to pop into the Nissan (7201.T) and Honda (7267.T) dealerships next door. But the Civic and Sylphy sedans in the showrooms are just eye candy. Cao wants to upgrade his car, but he’s facing a steep loan repayment on his flat, medical bills for his wife and a tough local economy in his once-prosperous coal town letter g cufflinks uk sale.
Cao is far from alone. China’s car market, the world’s largest, is on the brink of its first sales contraction in almost three decades, according to industry data, a signal of wider economic strains that are rattling the country’s leaders in Beijing letter g cufflinks uk sale. The slowdown – aggravated by a protracted trade war with the United States – is being most sharply felt in smaller, provincial cities like Pingdingshan, the engines of growth for Chinese consumption of cars and an array of consumer goods..
China has long hoped to spur consumption in these provincial cities as a way of diversifying an economy long reliant on manufacturing letter g cufflinks uk sale. But a slump in consumption spending is already being seen in things like cinema ticket sales, online shopping and smartphones purchases. Part of the reason is that provincial city consumers like Cao are being squeezed tight. Speaking to Reuters as he drove his MG through the outskirts of the city, Cao said capacity cuts at his main employer – the state-owned coal and chemicals conglomerate Pingmei Shenma Group – meant his income this year had dropped sharply..
He has taken up driving part-time for the ride-hailing giant Didi Chuxing to make ends meet. On a salary of around 6,000 yuan ($864.40) a month, Cao said he puts at least 1,000 yuan towards paying off his house loan, 400 yuan on medical bills for his wife and another large chunk on his two daughters’ education. “All these things put together, they slowly start to turn the screw on your life,” he said. “I want to drive a better car, but my situation won’t allow it. He added that the family had also cut back on luxuries like long-distance travel and fancy restaurants letter g cufflinks uk sale.
Cutbacks on car purchases by Cao and others like him in China’s smaller cities, are hitting local car dealers and global automotive makers from General Motors Co (GM.N) to Volkswagen AG (VOWG_p.DE) letter g cufflinks uk sale. “The main slowing markets now are those 4-6 tier cities in China,” said Xu Haidong, assistant secretary general at the China Association of Automobile Manufacturers, referring to smaller provincial urban centers. “These were the cities leading China’s auto sales growth in the past few years.”..