Company News

UPDATE 1-China Nov car sales double, aided by policy steps

* China Nov car sales jump 98.23 pct on stimulus steps

* Government seen continuing supporting auto industry in 2010 (Adds analyst comment, details)

SHANGHAI, Dec 8 (Reuters) - China’s passenger cars sales in November jumped 98.23 percent from a year earlier, official data showed, paving the way for roughly 50 percent growth in 2009 thanks to the government’s stimulus measures to aid consumption.

A total of 1.04 million passenger cars were sold in November in China, the world’s largest car market, compared with 522,800 units in November 2008 and 946,400 units sold in October, the China Association of Automobile Manufacturers said on Tuesday.

“Usually November sales are weaker compared with the golden months of September and October, but it turns out to be just another good month,” said Zhang Xin, an analyst with Guotai Junan Securities.

China’s auto market, which surpassed the United States as the world’s largest earlier this year, has been a major bright spot amid a global industry downturn aided by a raft of policy incentives which had effectively bolstered consumer confidence.

In the first 11 months, a total of 9.23 million passenger cars were sold in the country, up 49.70 percent from a year earlier, well exceeding a total of 6.76 million units sold in the whole of 2008, official data showed.

Overall vehicle sales, from trucks to buses, jumped 96.43 percent in November to 1.34 million units from a year earlier, the association said, after gaining 72.48 percent in October.

Among individual producers, General Motors [GM.UL] more than doubled its China sales to 177,339 vehicles in November, continuing its string of monthly sales records since the beginning of the year. [ID:nSHA154035]


Analysts had expected the market to slow considerably next year if the government opts not to renew the policy incentives, which will expire by the end of this year.

But positive signs that Beijing may continue its efforts to boost domestic consumption, including automobiles, are raising hopes for another solid year ahead.

According to a recent report by the Shanghai Securities News Beijing will continue to support its auto industry next year with more aggressive measures.

Sales tax cuts will apply to all passenger cars, not just to cars with a 1.6 litre engine or smaller, like they had been for this year even though smaller cars or those with lower fuel emission levels will enjoy deeper tax cuts, it said.

Many industry executives, including Chen Hong, president of China’s top automaker SAIC Motor, had also expressed optimism for continued stimulus measures from the government, which they said could lead to solid growth in the world’s largest auto market. (Additional reporting by Lu Jianxin)