Asia Chart of the Week:Toot toot

　　Our regular readers will know that we like to keep an eye on car sales to gauge thestrength of consumer demand in Asia (see, for example, Vroom, 20 March, 2015).

　　What does the latest data tell us? At the surface, things don’t look too shabby.

　　Car sales in China, and for the rest of the region overall, are running at recordhighs. The Mainland remains comfortably the world’s largest market, well aheadof the US. Look closely, however, and it becomes clear that in a number ofeconomies the data is artificially boosted by temporary purchase incentives, suchas tax cuts, including in Korea and China. In Singapore, too, the periodic need torenew car ownership licences has lifted sales. Here, underlying spending growthmay thus be weaker than headline numbers suggest. Still, with this in mind, wecan draw some conclusions. For example, domestic demand in Indonesia hasstabilized and is showing signs of improvement. In India, too, things are lookingup, with near record sales. Spending growth in the Philippines still tops theregion, even if it has cooled a little of late. On the other hand, things have gottenmore challenging in Malaysia, Hong Kong and Taiwan. That may be good fortraffic, but it hints at rapidly sagging demand.