China December auto sales up but growth slows

[January 10, 2011]  BEIJING (AP) -- China's auto sales rose by double digits in December as buyers rushed to take advantage of expiring tax breaks but growth weakened after a stimulus-driven surge early in the year, two industry groups reported Monday.

Global automakers are looking to China, the biggest market by number of vehicles sold, to help drive revenues amid weak demand in the United States and other major markets.

Total passenger vehicle sales rose 17.9 percent in December over a year earlier to 1.7 million units, the China Association of Automobile Manufacturers reported. It said full-year sales rose 33.2 percent to 13.7 million vehicles.

"Customers want to catch the tax-cut policy and the possible last opportunity to get car licenses in many northern cities," said auto industry analyst Zhang Xin at Guotai & Jun'an Securities in Beijing. "I think the growth will barely last in 2011 unless there is new stimulus policy out."

Sales of passenger cars, a category that does not include large buses, rose 26.7 percent in December from a year earlier to just under 1.5 million units, said a separate group, the China Passenger Car Association. It said full-year sales increased 30.5 percent to 13.3 million vehicles.

Car sales surged in early 2010 after Beijing cut sales taxes and offered subsidies to buyers of smaller, fuel-efficient vehicles.

China passed the United States in 2009 as the biggest market by number of vehicles as the global financial crisis battered American sales.

General Motors Co. says 2009 sales in China of GM-brand vehicles by the company and its local partners rose 29 percent to 2.35 million units. China passed the United States as GM's biggest market early last year.

Toyota Motor Corp. said sales by the company and its local partners rose 19 percent last year to 846,000 vehicles. Ford Motor Co. said sales in China last jumped 40 percent to 582,467 units, helped by a 52 percent rise in December.

Explosive growth in Chinese car ownership has helped to propel the rise of a domestic auto industry and demand for steel but has left Beijing, Shanghai and other major cities jammed with traffic and choking on smog.

Some cities are considering plans to counter traffic problems by raising license plate fees or imposing other curbs, according to industry analysts.

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Online:

China Association of Automobile Manufacturers:
http://www.caam.org.cn/

Blog of director of China Passenger Car Association: http://raodaauto.blog.sohu.com/

[Associated Press; By JOE McDONALD]

AP researcher Ji Chen in Shanghai contributed to this report.

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