China new car sales hit by chip shortage, COVID

New car sales in China dropped for the fourth consecutive month in August, due to a global semiconductor shortage and a surge in coronavirus infections in Southeast Asia.

Nearly 1.8 million new vehicles were sold last month, according to data released on Friday by the China Association of Automobile Manufacturers. That's down 17.8 percent from the same month last year.

The association cited two factors for falling production: the chip shortage and disruptions in the parts supply chain due to rising coronavirus cases in Southeast Asia. A resurgence of infections in China also had an impact.

Toyota and Nissan sales fell 11.9 percent and 10.6 percent, respectively. Another Japanese manufacturer, Honda, saw a decline of 38.3 percent.

The association says although car demand is stable, the chip shortage is ongoing, and that annual sales might not reach its initial projections.