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Automakers confident of China market despite slowing sales

Updated: 2011-11-24 15:29

(Xinhua)

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GUANGZHOU - Senior executives from major automakers attending the ongoing Guangzhou Auto Show have expressed their confidence in China's car market, forecasting an overall growth of 5 to 10 percent for 2012 as against this year's relatively slow 3 percent.

Kar-Thomas Neumann, president and CEO of Volkswagen Group China, said Volkswagen sales in China are expected to rise 15 percent year-on-year to exceed 2 million units, for the first time, by the end of 2011.

Neumann, who replaced Winfried Vahland to head the Volkswagen China in September last year, said he was optimistic about China's auto market, though it registered a record low growth this year in comparison with that in the past decade.

From 2001 to 2010, China has witnessed a stunning growth in its auto market, with annual sales rising more than sevenfold to over 18 million last year thanks to robust demand for private cars on the back of stable economic growth.

Neumann said China's economy would maintain the momentum after the effective macro-economic controls of the government, which had brought down the consumer price index and eased the housing market's troubles.

He said the great potential demand for cars in the second and third-tier cities would further bolster the growth of the auto market in China, where there are currently only about seven cars per hundred persons.

Neumann predicted that the passenger vehicle market would register a growth of 8 to 10 percent next year.

Yao Yiming, executive vice president of Guangqi Honda Automobile Co Ltd, a joint venture between the Guangzhou Automobile Group and Honda Motor, said China's auto industry needed a cooling-down period after developing too fast in the past two years as both production and sales doubled.

Yao said 2011 was a year for adjustment and the auto market would experience growth of 5 to 10 percent next year.

Feng Xingya, executive vice president of Guangqi Toyota Automobile Co, forecast that market growth would be above 8 percent, or even up to 10 percent, next year.

Feng said auto market growth rate should generally be 1.5 times of that of the overall economy.

Liu Jinliang, vice president of a private Chinese automaker Geely Motor, said his company would witness a steady growth in car sales in 2012, when new Geely models were expected to roll off assembly lines on mass.

Liu estimated an increase in sales of over 5 percent next year.

Addressing a forum prior to the Monday opening of the show, Wang Xia, director of the auto section of the China Council for Promotion of International Trade, said China had withstood competition from foreign competitors since its entry into the World Trade Organization a decade ago and become the world's largest auto market.

Wang called a "miracle" of the average annual growth of 24.25 in the Chinese auto market in the past decade.

He said the auto sector in China would, from this year on, bid farewell to an era of high-speed growth. Instead, it would enter a period of steady and mild growth, which would last for quite a long time, he said.

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