Hong Kong
CNN business

Shanghai posted zero auto sales last month as China ramps up its tough measures to combat the pandemic.

The largest metropolitan area in China, with a population of 25 million, has been under strict lockdown for seven weeks. Authorities have ordered people to stay at home and closed many businesses in a bid to stamp out the city’s worst-ever Covid outbreak.

Although authorities announced on Monday that they would allow “low level activities” in some areas, scores of residents told CNN they had not been allowed to leave their apartment complexes.

The Covid restrictions have had a severe impact on the city’s auto market – almost all dealerships were closed and no sales were recorded at all, according to a statement released on Monday by the Shanghai Automobile Sales Trade Association.

Overall, China’s auto sales in April fell 46% from March to 1.2 million vehicles. It was the worst April sales in a decade, the China Automobile Manufacturers Association said last week.

China has imposed tough restrictions as it battles the biggest Covid outbreak in more than two years. More than 30 cities in China are in full or partial lockdown, affecting up to 187 million people across the country, according to CNN estimates.

Shanghai is hugely important to China’s auto industry.

The city is #1 in total car sales – about 736,700 new Vehicles were sold in Shanghai last year, the most of any Chinese city, according to statistics from the country’s main insurance regulator.

It is also a major manufacturing hub, home to automakers such as Tesla (TSLA) and Volkswagen (VLKAF), as well as major parts suppliers Bosch and the ZF Group.

Lockdowns in Shanghai and other cities have caused massive supply chain disruptions and hit consumer spending in the world’s second largest economy.

Tesla sales in China plummeted 98% month-on-month in April, according to data from the China Passenger Car Association. Production at the Shanghai plant also fell by 81%. It’s a stark turnaround for the US automaker after a strong start to the year in mainland China.

Toyota said last week that it had halted operations at 14 production lines at eight plants in Japan because of the parts shortage resulting from the lockdown in Shanghai.

Nissan Motor also reported a 46% year-on-year decline in sales in China.

– Teele Rebane and Lauren Lau of CNN in Hong Kong contributed to this report.

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