China auto sales up nearly 14% in 2013: industry

By Bill Savadove, AFP

SHANGHAI — China’s auto sales smashed through the 20 million mark last year, growing nearly 14 percent and extending its lead as the world’s biggest car market, an industry group said Thursday. Sales in China, the world’s biggest auto market since 2009, surged 13.9 percent to 21.98 million vehicles last year, the China Association of Automobile Manufacturers (CAAM) said, as a recovery in Japanese brands offset the impact of slowing economic growth. Passenger vehicle sales jumped 15.7 percent year-on-year to 17.93 million units, the group said in a statement. China’s huge auto market is critically important to foreign companies, which have looked to its vast potential to take up the slack from flagging sales in Europe, where French car sales hit a 15-year low in 2013 and German car sales also fell. In the United States, total auto sales rose 7.6 percent to 15.6 million vehicles in 2013, according to Autodata, their best annual performance in years. In 2012, Chinese auto sales had risen just 4.3 percent annually to 19.31 million vehicles, hurt by slowing domestic economic growth, limits on car numbers imposed by some cities to cut pollution and congestion, and a territorial row between Beijing and Tokyo that hit sales of Japanese-brand cars. China’s economy — already the world’s second largest — registered its worst growth rate for 13 years in 2012, expanding at an annual rate of 7.7 percent.

Growth probably slipped further in 2013 to 7.6 percent, state media reported in December, just above the government’s annual target of 7.5 percent. But Japanese brands have continued to recover from the downturn in 2012, when political tensions grew over disputed islands in the East China Sea, causing some consumers to shun their Asian neighbor’s products. “Although the economic situation was bad in 2013, there were many catalysts for the car industry,” said Cui Dongshu, deputy secretary general of the China Passenger Car Association, another industry group. “There was strong demand for replacing old vehicles with new ones. Japanese brands also rebounded after their downturn in 2012 as domestic consumers have high regard for them,” he told AFP. In its figures, CAAM said sales of Japanese-brand passenger cars amounted to 2.93 million in 2013, but gave no percentage change. In December alone, total vehicle sales in China — both passenger and commercial — rose 17.9 percent year-on-year to 2.13 million units, CAAM said. Some foreign companies have already announced record China sales in 2013. U.S. auto giant General Motors sold 3.16 million vehicles in the country last year, up 11.4 percent from 2012. “GM maintained good growth momentum in our company’s largest market, despite a modest slowdown in demand for commercial vehicles,” president of GM China, Matt Tsien, said in a statement on Tuesday. Competitor Ford sold 935,813 vehicles in China last year, up 49 percent from 2012, as the U.S. company introduced more new vehicles to the market. But analysts said auto sales could slow this year from 2013. “Surging sales are expected to see a slowdown as government restrictions curbing new vehicle sales are enforced across cities in China, as the levels of pollution hit record highs,” IHS Automotive senior analyst Namrita Chow said in a recent report. Last month, the northern city of Tianjin became the latest to limit cars by capping the number of license plates it issues annually. IHS forecasts passenger vehicle sales will rise around 10.4 percent this year. Cui of the China Passenger Car Association forecasts vehicle sales will rise ten to 12 percent this year, as the one-off boost from the improvement for Japanese brands eases.