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World's biggest car markets reach end of the road
SOME of the world's biggest car markets may be reaching the end of the road for growth.
After almost every major carmaker posted declining US deliveries in July, most missed analysts' estimates for August, and the annualised industry sales rate decelerated to the slowest in a year.
The fear is that demand has peaked, and will continue to dwindle in the absence of higher sales incentives.
Sales in other countries have fallen as well, including in China, where increased tariffs and an escalating trade spat with the US may be dragging on demand.
Demand in China, the world's biggest car market, has fallen in the past couple months amid a worsening trade war with the US that has left some consumers holding back from buying American-branded vehicles.
China's economy also is showing signs of weakening, with the yuan declining and stocks in Shanghai falling 18 per cent since the start of the year.
The Passenger Car Association of China will detail August numbers next Monday.
In Japan, Asia's second-largest economy, passenger-car sales are down 3.4 per cent during the first eight months of 2018 compared with the same period a year earlier.
Japan's rapidly ageing population is contributing to more drivers giving up their licences, while the costs of buying and maintaining a vehicle have led younger consumers to shun car ownership.
Vehicle owners also are waiting longer to replace their rides, now taking an average of 7.7 years, according to a survey by the Japan Automobile Manufacturers Association.
Over in Europe, sales are up overall, but the region's four largest car markets - Germany, the UK, France and Italy - recorded zero growth in the first six months of this year.
And the situation looks worse for late 2018: Ernst & Young has warned that German car registrations will decline after August due to a new testing protocol that companies have been slow to adapt to.
In the UK, the Society of Motor Manufacturers and Traders (SMMT) warned against overconfidence.
SMMT's chief executive Mike Hawes said in a statement: "It would be wrong to view the market as booming." BLOOMBERG