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Demand Fuels Car Growth
Sales of Chinese-made vehicles during the first three quarters of this year have already topped those for the whole of last year, according to an industry association.

Statistics released last Friday by the China Association of Automobile Manufacturers showed that domestically made vehicle sales reached 2.38 million units during the first three quarters of this year, an increase of 33.65 percent from the same period last year. Total sales last year stood at 2.37 million units.

Sales in the third quarter of this year came to 841,500 units, according to the association.

"The robust sales mainly resulted from strong domestic demand fuelled by China's steady economic growth and continuing rise in people's disposable income," said Zhu Yiping, an association official.

Passenger cars and heavy-duty trucks were the two biggest growth engines for total vehicle sales during the first nine months of this year, Zhu said.

Sales of Chinese-made passenger cars during the period increased by 47 percent year-on-year to 803,200 units, according to the association. Last year, total car sales amounted to around 720,000 units.

During the first nine months of this year, 195,100 heavy-duty trucks were sold in China, up 91.7 percent from a year earlier, the association said.

Qie Xiaogang, who works at the Beijing Asian Games Village Automobile Exchange, said: "Vehicle sales were also boosted significantly by local manufacturers' new product launches, especially passenger cars, which provided much more choice for Chinese consumers in terms of models and prices than before."

Qie said sales in his auto exchange, the largest in Beijing, reached a record monthly high of 5,577 units in September.

Manufacturers have launched dozens of new passenger cars so far this year such as Shanghai Volkswagen's Polo, Nanjing Fiat's Palio and Siena, and the Elysee of Dongfeng Citreon, based in Wuhan in Central China's Hubei Province.

These companies have benefited greatly from their new product launches.

Shanghai Volkswagen, a joint venture between the Shanghai Automotive Industry Corporation and Germany's Volkswagen Group, said its sales in September this year totaled 33,000 units. This was the company's second consecutive monthly sales figure of more than 30,000 units.

Dongfeng Citroen, a joint venture between the Dongfeng Motor Corporation and French carmaker PSA Peugeot Citroen, said its sales last month surpassed 10,000 units.

According to Zhang Boshun, another association official, all of the major Chinese automakers are earning profits mainly thanks to upbeat sales, except for the Nanjing Yuejin Automobile Group, Beijing Automotive Industry Corporation and Tianjin Automotive Industry Corporation.

Government controls on vehicle imports also contributed to a sharp increase in Chinese-made vehicles, said Jia Xinguang, chief analyst from the China National Automotive Industry Consulting and Development Corporation.

"The government has succeeded in controlling complete vehicle imports by restricting the distribution of import permits and giving a majority of this year's import quota to auto parts, although it cut tariffs from between 70 and 80 percent to between 43.8 and 50.7 percent at the beginning of this year," Jia told China Daily.

The country imported 80,900 vehicles during the first eight months of this year, much fewer than earlier forecasts by analysts.

According to the association, the vehicle output during the first three quarters of this year amounted to 2.336 million units, an increase of 32.8 percent over the same period last year.

The total output last year was 2.341 million units.

(China Daily October 21, 2002)

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