China's auto industry, which was expected to be the hardest hit manufacturing sector after the nation's entry into the World Trade Organization (WTO), achieved stunning growth in production and unit sales last year, boosted by strong-than-expected domestic vehicle demand.
According to the State Development Planning Commission, China's total auto output increased by 38 percent year-on-year to 3.25 million units in 2002, the first year following the WTO entry.
"Both output and sales of passenger cars made in China topped 1 million units for the first time last year," the commission said.
Carmakers in China produced 1.09 million passenger cars last year, up 55 percent from the total in 2001.
Sales of domestically produced passenger cars grew by 56 percent year-on-year to nearly 1.126 million units last year, the commission said.
Industry sales totaled 646.5 billion yuan (US$77.9 billion), an increase of 30.8 percent from a year earlier, according to the commission.
Profits reached 43.1 billion yuan (US$5.19 billion) last year, up 60.94 percent from 2001.
The industry's rapid development seems to dispel analysts' earlier worries that it would face severe challenges after the WTO entry.
At the beginning of last year, China cut its tariffs on auto imports to 43.8-50.7 percent from 70-80 percent under WTO obligations.
The better-than-expected scenario has made analysts and company executives optimistic about the market this year.
Most of them predict total domestic vehicle demand will rise by more than 20 percent to at least 3.8 million units this year.
(China Daily January 14, 2003)