UPDATE 1-SAIC Aug car sales growth slowest this year

Tue Sep 7, 2010 10:14am EDT

Related Topics

* Aug auto sales up 22.2 pct at 286,814

* Other automakers also report moderate Aug sales

* Automakers slow down pace to move stocks to dealers

(Adds analyst comments, details, background)

By Fang Yan and Ken Wills

BEIJING, Sept 7 (Reuters) - Top Chinese automaker SAIC Motor Corp (600104.SS) sold 22.2 percent more vehicles in August than a year earlier, its slowest gain so far this year, though up on July's total unit sales.

SAIC, which runs vehicle manufacturing ventures with General Motors [GM.UL] and Volkswagen (VOWG.DE), sold 286,814 vehicles in the month, it said in a statement to the Shanghai Stock Exchange on Tuesday.

In July its vehicle sales had risen 24.6 percent year-on-year to 278,947 vehicles.

Analysts attributed the slight slowdown to explosive demand for its Wuling brand mini vehicles in 2009.

"Wuling sales were so strong last year, it pushed up the comparative base too high," said Zhang Xin, an analyst with Guotai Junan Securities. "But its two car ventures still see some good growth, even though not as fast as in 2009."

China, which overtook the United States as the world's largest auto market last year, has been a major bright spot as the global industry struggles to recover from a steep downturn.

But the market has been slowing since May as Beijing took measures to keep the economy from overheating.

Some other makers also saw slower or even negative growth in August. Honda Motor's (6267.T) China car sales rose just 5.9 percent, while Warren Buffett-backed BYD (1211.HK) saw its monthly sales falling 19 percent from the year-ago level.

However, data provided by government-affiliated China Automotive Technology & Research Center (CATRC) showed the country's retail car sales in August jumped nearly 60 percent year on year. [ID:nTOE67N03X]

Monthly data provided by most automakers gives the number of vehicles they shipped to dealers, not cars actually sold.

Despite a recovery of demand in August, automakers had slowed shipments of stock to dealers, who were already complaining about rising inventory levels, analysts said.

Some BYD dealers had even pulled out of the network after their inventory piled up, local media said.

Shanghai GM, its car venture with the Detroit automaker, sold 81,067 cars in August, up 28 percent on a year ago, with sales at its venture with Volkswagen rising 32 percent, company data showed.

But sales at SAIC-GM-Wuling, a three-way tie-up between SAIC, GM and Liuzhou Wuling, climbed just 6.9 percent. (Reporting by Fang Yan and Ken Wills; Editing by Will Waterman) ($1=6.787 Yuan)

FILED UNDER: