MercoPress. South Atlantic News Agency

The world on wheels: China reports record sales of cars

Sales are expected to reach 12 million this year

Chinese annual car production has topped 10 million for the first time as carmakers boost output to meet growing demand, state media has said. The 10 millionth car produced this year rolled off the First Automobile Works Group assembly line in Changchun, the official Xinhua News Agency reported.
In September sales soared 78% compared to a year ago totalling 1.33 million units.

Despite the downturn and falling sales at most global carmakers, demand for cars in China is booming.

State incentives, such as tax cuts on small cars, have boosted sales. Like many other governments around the world, China has also introduced subsidies to trade in older vehicles.

Previously, only the US and Japan had produced 10 million cars in a single year.

Domestic Chinese car sales overtook those in the US for the first time in December of last year, and this trend has continued.

Global carmakers are now increasingly targeting China as a key growth market. Overall annual sales are expected to hit 12 million by the end of the year. Sales from January to September rose by 34.2% to 9.66 million units. 2008 sales were at 9.4 million vehicles, 8% higher than 2007, but lacking the 21% growth in the car market that 2007

Meantime General Motors said it aims to grow faster than China's auto market in 2010, according to its Beijing chief Kevin Wale.

GM, which competes with Volkswagen AG and others, sold 55.6% more vehicles in China from January to September, leading a 34.24% gain in the overall market.

“Next year we will again try to grow a little faster than the market's growth,” said Wale, president and managing director for GM's China operations.

Wale, speaking to reporters, he anticipated the Detroit automaker may sell more than 1.6 million vehicles in China this year, in line with his earlier forecast of more than 40% year-on-year growth. It sold 1.09 million vehicles in China in 2008.

Wale is optimistic on the outlook of the China auto market, which overtook the United States as the world's biggest in January, as he believes Beijing will come up with additional steps to support the industry, a major contributor to the country's economy.

“We expect sales to continue to grow next year. We are confident the government will take appropriate action to continue stability in the market,” he said, adding that demand in smaller cities would also ensure some growth momentum.