Mon, Dec 12, 2005 - Page 11 News List

Chinese automakers could rival multinationals

EYE ON THE WORLD China's vehicle exports exceeded its imports for the first time last week, and auto startups are moving ahead with aggressive export strategies

AFP , SHANGHAI

It failed miserably in crash tests conducted even at relatively low speeds, posting the lowest score of any vehicle ever tested by the German automobile association ADAC.

But other analysts note that all the major Asian auto players, led by the Japanese and then the South Koreans, suffered similar criticisms when they set off for the US and European markets.

Even though the Chinese players are looking to export, the domestic market in China remains a source of ambition for the major US, European and Asian car makers.

The Chinese car industry has been the hottest market in the world for the past three years and the potential remains huge.

Only 24 out of every 1,000 Chinese people own a car, compared with 750 in the US and 120 globally, according a study by IBM Business Consulting Services and the University of Michigan

Sales for companies such as General Motors, Honda, Hyundai and even struggling Volkswagen have been bright spots in China for the past three years that have seen otherwise slumping global sales.

Pushed on by an economy growing at rates of well above 9 percent, China is currently the world's fifth largest car market and expected to become the third largest by 2008.

By 2010 China is expected to surpass Japan to take the second slot after the US.

Production this year is expected to reach approximately 5.6 million units by the end of the year, up 10 percent from a year ago, a far cry from the growth rates of nearly 70 percent two years ago, but still exemplary.

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