Tue, Oct 11, 2005 - Page 10 News List

Volkswagen sales in China rise 2% after prices slashed

BLOOMBERG

Volkswagen AG, the biggest carmaker in China in the first half of the year, said sales rose 2 percent last month, as it reduced prices to lure customers.

Sales last month were 53,000 units compared with 51,900 units in the same period a year ago, Volkswagen spokesman Kai Grueber said. The company had 19 percent of the market.

Volkswagen, which counts China as its biggest market outside Germany, is trying to reverse three years of declining profit. It cut prices on 18 models made by Shanghai Volkswagen Co by as much as 14 percent in August, the first across-the-board discount this year.

Volkswagen, which used to have more than half of China's car market, has been losing market share to rivals including General Motors Corp and South Korea's Hyundai Motor Co. Its market share in China was 18 percent at the end of June compared with GM's 10.9 percent.

Volkswagen has two car-assembly ventures in China with FAW Group Corp (中國第一汽車) and Shanghai Automotive Industry Corp (上海汽車工業). FAW-Volkswagen makes Bora, Jetta and Golf models, as well as Audi-brand luxury cars.

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