China’s automotive sector rebounds

China’s automotive sector continued to recover in May, starting to make up for some of the losses earlier in the year. Implied steel demand has also increased, driven partly by an increase in commercial vehicle sales, Kallanish notes.
China produced 2.187 million vehicles in May, up 18.2% year-on-year, according to the China Association of Automotive Manufacturers (CAAM). That was still some way off the peaks of over 3m units/month in the industry’s heyday in 2017, but was a rapid improvement from just 285,000 units in February during the lockdown. Over the year to date, automotive output is now 7.787m units, down 24.15 y-o-y. 
Implied finished steel demand was up 21.26% at 3.83m tonnes in May, Kallanish calculates. Over the year, demand is now down just 18.61% y-o-y at 13.777mt. This is because of a resurgence in truck sales. Commercial vehicle sales were up 48% in May to 520,000 units, driven by trucks for infrastructure projects.