Chinese car market shrugs off gloom

CAR sales in China have surged back to record growth levels this year, with General Motors and its joint venture partners leading the way by posting a massive 38 per cent jump to a first-half sales.

At this rate, the Chinese motor industry is on target to accelerate past the 11 million-unit mark in 2009 – up about 15 per cent on China’s 9.35 million tally in 2008 and more than a million more vehicles than the once-dominant US auto market is expected to achieve this year.

Renewed economic confidence and Chinese government stimulus packages, including sales tax cuts for vehicles under 1.6 litres, have helped to spur the boom in a country that is rapidly falling in love with the motor car.

To the end of May, the Chinese car market was up 14 per cent on last year, and although overall figures have not yet been released for June, record monthly sales tallies posted by major car companies would indicate that this figure is set to soar.

Honda reported a 54 per cent sales jump in June compared with the same month last year, lifting its year-to-date sales to 253,812 – an increase of 12 per cent over 2008.

Ford’s Chinese sales are up 14 per cent, to 197,212 units for the first six months of 2009.

Left: The Chevrolet Spark.

GM Group – headed by Australian former Holden finance executive director Kevin Wale – has taken full advantage of the unexpected growth in the face of the global economic downturn, selling a first-half record 814,442 vehicles with local partners that include Shanghai Auto and Wuling.

Buick sales jumped 34 per cent to 195,989 vehicles, while Chevrolet sales were also up, led by a 60 per cent jump in sales of Spark – a mini car that has been mooted as a possible entry-level vehicle for Holden in Australia in its next, GM-designed generation.

Mini commercial vehicles have been red-hot sellers so far this year. A minivan produced in a GM joint venture with Wuling – the Wuling Sunshine – is the top-selling passenger vehicle in the country, selling 295,789 units in the six months to June 30.

Mr Wale, GM China Group's president and managing director, said the Chinese market had continued to outpace most expectations for growth.

“For the first time ever, GM and our joint ventures exceeded domestic sales of 100,000 vehicles in each of the first six months of the year,” he said.

Mr Wale predicted that vehicle sales would continue to remain strong for the remainder of the year, describing GM and its partners as “an engine for industry growth”.

In fact, the market might accelerate further if reported rumours of further sales tax cuts – this time for 1.8-to-2.0-litre vehicles – are introduced by the government.

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