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Vehicle sales and output climb again
By Gong Zhengzheng (China Daily)
Updated: 2004-09-13 08:38

Both vehicle output and sales in China rebounded in August after declining in four consecutive months from April to July, according to an industry organization.

The nation's vehicle output and sales stood at 375,200 units and 382,300 units last month, up 5.97 per cent and 10.5 per cent respectively from July, statistics from the China Association of Automobile Manufacturers show.

This is the first growth over the past five months. The figures in July dropped by 15.48 per cent and 8.98 per cent from June.

"The growth in August was mainly generated by warming market demand following its bottoming out in July," said Zu Yiping, a spokeswoman for the auto association.

Output and sales of trucks reported the biggest growth in August among the three main types of vehicles, the association said.

Truck output last month jumped by 25.57 per cent to 119,900 units from July with sales growing by 25.66 per cent to 123,600 units.

Passenger car output and sales reached 171,900 units and 170,300 units in August, up only 0.02 per cent and 0.23 per cent from the previous month.

But output of buses declined by 3.79 per cent to 83,500 units in August from July with sales increasing by 13.75 per cent to 88,300 units.

"Both vehicle output and sales will continue to be on an upward trend in September," Zu said.

Accumulated vehicle output and sales in China reached 3.41 million and 3.28 million units in the first eight months of this year, up 21.18 per cent and 19.20 per cent from a year earlier, according to statistics.

Passenger car output and sales achieved the biggest growth of 26.23 per cent and 23.68 per cent year-on-year to 1.62 million and 1.51 million units during the period.

Truck output and sales rose by 16.76 per cent and 21.34 per cent year-on-year to 967,700 units and 977,500 units, and that of buses increased by 17.14 per cent and 9.35 per cent to 817,200 units and 796,700 units.

However, Shen Ningwu, the deputy secretary-general of the auto association, said last Thursday that total vehicle output this year will grow by around 20 per cent from last year and will fail to reach the association's previous estimate of 5.3 million units.

Last year, total vehicle output grew by 34 per cent to 4.39 million units.

Analysts say that adverse factors in the growth of domestic vehicle demand will remain for the rest of this year. They include government control on car loans, China's cancellation of quotas and further tariff cuts on auto imports next year, which will continue to dampen people's buying enthusiasm.

Many commercial banks in China have raised the threshold for car financing and even halted the process for fear of bad loans.

The nation will slash its tariffs on auto imports to 30 per cent at the beginning of 2005 from the current 34.2 to 37.6 per cent according to its commitments to the World Trade Organization.

First Automotive Works Corp (FAW) remains the biggest Chinese automaker by selling 616,000 vehicles during the first eight months of this year, up 7.82 per cent from a year ago, statistics show.

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