While the inventory runs high, the demand has been weak for some time. As a factor of the inventory alert index, it stood at 15 percent in November; the healthy level should be above 50 percent.

Ominous signs started to loom months ago, in August, when the index was 52.2 percent; since then, it rocketed by 23 percentage points.

Sales during the same period have plunged. A 0.7 percent dip emerged in July, and sped up to an 11.7 percent slump in October.

The fall is very likely to be even steeper in the last two months of the year, partly because of abnormally high comparative bases resulting from people's rush to take advantage of a purchase tax discount last year.

"Don't forget, some 3 million vehicles were sold last December, but this year, sales rarely exceeded 2 million even in (what are traditionally) the best months of September and October," Lang said.

"Speaking of car wholesale, we may see a 3 percent fall from 2017. When it comes to retail, it will surely … fall more than 5 percent," she said.

Her association has advised the dealers to keep a watchful eye on their stock level to prevent risking too much damage to their financial health.

A breakdown suggests that dealers of Chinese-branded vehicles are most susceptible to the chill in the market. They are laden with the most inventory－77.2 percent in November, up from around 69.8 percent in October, according to the association.

Industry insiders say it is a common practice for carmakers, especially Chinese ones, to force their dealers to take in more cars than they can sell.

The adverse effects are not obvious when the market is good, but they will manifest themselves and take a heavy toll in a bear market, they said.

Dealers who sell premium cars are a better condition, with the index standing at 66.1 percent in November, up from 60.4 percent in October.

This is probably because most premium car brands are seeing growth so far, with some of them growing at a double-digit rate, a stark contrast to the overall market.

Mercedes-Benz delivered 603,089 cars from January to November, up 11.7 percent year-on-year.

GM's premium Cadillac brand said in late November its China sales had exceeded 200,000 units this year, a goal it set for 2018, soaring 30 percent from the same period last year.

Sitting in between are dealers of volume international brands such as Volkswagen and Toyota, at 75.8 percent.

But their index grew 8.8 percentage points from the previous month, the largest of all three groups, a sign for carmakers to extend a hand to their dealers.

Dongfeng Renault said it is cutting the stock of the dealers when it launched the new Kadjar in late November.

"We hope to cut the inventory to the lowest possible level by the end of the year. We are trying to know more about the market and help our dealers to have a brighter future," said Hong Hao, deputy president of the Sino-French joint venture.