November 9, 2010 / 7:56 AM / 7 years ago

UPDATE 2-China Oct car sales up 27.1 pct

 * Oct market demand strong, extends rebound since Aug
 * Growth seen in Nov, Dec spurred by tax incentives
 * GM, VW, Ford continue to shine, Toyota, BYD sales fell   (Adds graphics)
 By Fang Yan and Ken Wills
 BEIJING, Nov 9 (Reuters) - Automakers in China shipped 27.1 percent more passenger cars to dealers in October than a year earlier, extending a rebound from August as people rushed to buy cars before Beijing's policy incentives expire at year-end.
 But it was not a rosy picture across the board. General Motors [GM.UL], Volkswagen (VOWG.DE) and Ford Motor (F.N) continued to shine, but Toyota Motor (7203.T) and BYD (1211.HK) saw their sales turning south for different reasons.
 "The market seemed to have lost some of its steam in June and July but bounced back again since August. It's quite likely that we will end the year with a rather positive note again," said Chen Liang, an analyst with Huatai Securities.
 Monthly sales may top the 1-million mark in November and December, thanks to year-end promotions by automakers eager to achieve or exceed their annual sales target, other industry observers say.
  Beijing had in 2009 unveiled tax incentives for cars with engine sizes of 1.6 litres or smaller, a move that helped China surpass the United States as the world's largest auto market that year. The incentives, which had been scaled back since January this year, will expire on Dec 31.
 In October, a total of 1.2 million sedans, sport utility vehicles and multi-purpose vehicles were shipped to dealers in October, compared with 946,400 units a year earlier, the China Association of Automobile Manufacturers (CAAM) said on Tuesday.
 That compared with the September tally of 1.2 million units, which represents year-on-year growth of 19.3 percent.
 Overall vehicle sales, which also include buses and heavy trucks, came to 1.54 million units, up 25.5 percent from a year ago. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^   For a Graphic on monthly China car sales: ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
 While reporting a mere 3.5 percent auto sales gain in its home market in October, lagging a 13 percent gain in the U.S. market, GM's China auto sales gained 19.6 percent in the month. [ID:nTOE6A303A].
 Sales of Volkswagen's car venture with top Chinese auto group SAIC Motor (600104.SS) jumped 45.3 percent. Ford Motor (F.N), a relative newcomer to China, saw its sales up 33 percent.
 But BYD (1211.HK), 10-percent owned by U.S. billionaire investor Warren Buffett's Berkshire Hathaway (BRKa.N), saw monthly sales falling for the third straight month.
 BYD had been expanding its sales network aggressively and pressing its dealers to hike their sales targets. Such strategies had worked well in 2009 when automakers could hardly keep up with market demand, but backfired as inventory levels have piled up since the summer months.
 Toyota, still reeling from the aftermath of a wave of global safety recalls, reported its first monthly sales decline in 18 months. [ID:nTOE6A1002]     

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