Automakers view China as one of the top markets in world

BEIJING — Automakers issued ambitious forecasts Sunday of up to 65 percent sales growth in China's booming market this year _ a striking contrast to the gloom in the United States and elsewhere.

Sales of some individual models to newly prosperous Chinese drivers soared by up to 100 percent in the first quarter over the same period of 2007, said executives speaking at the Beijing auto show.

Toyota Motor Corp. expects to sell 700,000 vehicles in China this year, up 40 percent from 2007, executive Yuzo Ushiyama said.

"As the 40 percent (target) is much bigger than the overall market growth, this is challenging," Ushiyama told reporters. "But we want to try (700,000 vehicles) as our goal."

Automakers are looking to China to drive sagging sales at a time when demand in the United States is expected to decline this year while Europe and Japan are flat.

Sales in China, already the world's No. 2 vehicle market after the United States, are forecast to grow 15 to 20 percent this year, driven by a boom that saw the economy grow by 10.6 percent in the first quarter.

Last year, Chinese drivers bought 5.5 million cars, minivans and SUVs and 3 million commercial vehicles, up from just 1.6 million vehicles sold in 1997. J.D. Power and Associates says sales should grow by 1 million vehicles annually through 2015.

"I think every year for some time in the future the same thing is going to happen," said Philip Murtaugh, Chrysler LLC's chief executive for Asia.

The number of Chinese families that can afford a car is expected to mushroom from 10 million in 2005 to 75 million in 2005, according to Jim Raymond, a General Motors executive.

The rivalry for a share of China's market has turned the Beijing auto show into a major industry event that this year drew more than 100 Chinese and foreign automakers. On Sunday, as companies held presentations for reporters, they competed for attention with live bands, acrobats and dancers. The show opens to the public on Thursday.

On Sunday, Daimler CEO Dieter Zetsche was joined on stage by Chinese film star Zhang Ziyi as he showed off the new Mercedes-Benz SUV, the GLK, which goes on sale in China next year.

Major U.S., Japanese and European competitors are growing faster than the market as a whole, building market share at the expense of China's dozens of tiny automakers.

Volkswagen AG's sales in China grew 32 percent in the first quarter, executives said. They gave no full-year projection but said they hope to top 1 million vehicles in 2008, which would be a 10 percent increase over 2007's 910,491 cars.

"In no other country does this brand sell as many cars as in China," VW chairman Martin Winterkorn said.

Hyundai Motor Co.'s Chinese joint venture expects to see sales rise 65 percent this year to 380,000 cars, executive vice president Li Honglu told Dow Jones Newswires.

France's PSA Peugeot-Citroen expects to sell 150,000 cars in China this year, a 30 percent increase over 2007's 115,000 vehicles, according to Jean-Louis Chamla, vice president of international sales and marketing.

Daimler AG said Mercedes-Benz sales in China rose 42 percent in the first quarter. That included a 110 percent jump in sales of the R-class minivan.

Zetsche declined to give a 2008 forecast but said Mercedes will add 20 new dealerships in China this year, bringing the total to 120.

Still, automakers said they face intense competition and pressure to cut prices in China, where dozens of small Chinese producers measure their share of the fragmented market in fractions of a percentage point.

"I think this is just the most competitive market in the world," said Carlos Tavares, executive vice president of Nissan.

Comments

[loki]

Yes, China will be growing in leaps and bounds and soon will take over America as the most wealthiest and most advanced country in the world. How did they do it so quickly. Only in the 1960's , even the 70's they were hardly feeding a third of their own population and they were basically technological ignorant.
You can thank the wonderful US corporations and US government for their rapid rise and domination of the US economy. And face the truth, they do dominate us. If they stop production or just demand re-payment of the 100's of billions Bush has borrowed to fund his war and tax breaks for the rich, we would be crying. Corporations ran to China for cheap labor and no regulations. Corporations handed China every piece of technology , manufacturing techniques and underhanded corrupt method of doing business US corporates had perfected over the last 100 years. They also gave them the money to grow, exceed, and dominate us completely. Hey, I dont blame the Chinese one bit. They saw the American Greed and accepted it with open arms. Taking notes and perfecting it the whole time. Yes , the brightest and the best trained from Harvard and Yale who run US corporations and dominate our government have made China what it is today.

[MilwaukeeDan]

loki, from reading your several comments on this post, it's obvious you have kept up with international news(something you won't read in our MSM). I agree with you 100%, but most Americans think Chinese still pedal around on their bicycles in their communist era uniforms, nothing is further from the truth. One of the reasons for fuel cost rising is the Asians are buying a record number of cars(and who is to blame for that?). As you have stated, China has gone global, there is hardly a country on earth they are not doing business with.

[MetalCanuck]

We are in lots of trouble if we do not keep a strong dollar and end overseas adventures. We need to end the war on drugs and get rid of the corrupt government and that means voting Ron Paul or a third party.

[Oakland]

Why shouldn't it be growing. They've got all of our jobs, so they are the only people who can afford to buy them. We can thank Bill Clinton and the rest of the "free traders" out there. The only thing that's free is our tax revenues to bail out Bear Sterns and how many others. We need to throw all of the bums out. We need a real revolution in this country.

[vandegrasse]

You got it, Oakland. But it ain't gonna happen. American people have been wussified and cowed. My God, we elected two Bushes and one Clinton and might even elect another Clinton. What big business wants, big business gets.

[loki]

I agree with both of you 100%. One thing that corporations and our government know beyond a shadow of a doubt is that many if not most Americans are either wusses, stupid, and or very easily manipulated. By choice or by genetic defect. They know they can control us, rape us, robe from us, and then tell us they are doing everything for the American people, and we will eat it up. Corporates may not be the sharpest tools in the shed, but they do hire some pretty sharp fellers to help them divide and conquer Americans everywhere.
And its not hard when your dealing with such low intelligence levels. And I saying that greatly ashame me as I know we have been and can be so much more than the spineless losers we, the American public have become. I think we have had to much , to fast, to long, and we have become numb to reality. I dont know, but I do know that its not going to get any better if we keep believing the lies and allowing others to control us like we do.

[ErnestineBass]

China will eventually suffer the same "consumer collapse" that we have.

[biosolution]

Not unti after they eat our lunch, I'm sorry to say.

[aceholiday]

bingo

[hypnotoad72]

Our economies are ultimately symbiotic. If they eat our lunch, they're eating it too.

[loki]

"Our economies are ultimately symbiotic. If they eat our lunch, they're eating it too."

10 years ago I would have agreed with you on that, but in the last 7 years China has aggressively negotiated and signed many trade agreements with just about every single country on the planet. Something you don't hear about in the American media, but if you travel to China , read Chinese papers or even just watch CCTV English on Dishnetwork, you would have known this for some years now. From Russia to Belize , England & Saudi Arabia and even Indonesia and Australia, the Chinese have been working the planet and signing trade deals that have totally diminished US trade with these countries 75% and more. Exclusive oil and natural gas deals with Russia , Saudi, Iran, and others also damage our economy. The Chinese have learned a lot from US corporations and US government who opened the doors and gave the technology and knowledge to them , all in the name of profit. Nope, the Chinese would feel it if the US economy totally disappeared tomorrow, but they would still do fine. On the other hand, if the Chinese totally cut us off tomorrow, we would last a 1 or 2 tops as we no longer have the skills, technology or manufacturing capability to produce the minimum to survive.

[UncleJimbo]

I said that a few months ago when an Indian company unveiled a $2,500 car! Just wait till a Billion Indians and a Billion plus Chinese get on the roads! Oh,I mean the pollution...not their lousy driving!

[hypnotoad72]

With the "global economy", will that $2500 car arrive in America?

And even with the price, who would want it if the mileage was too low or couldn't beat a sardine tin in a safety test?

[morbie5]

that 2,500 car is a death trap

[vandegrasse]

So our world is becoming, the very air we breathe.

[kingcityguru]

Can we please start building nuclear reactors so that the next wave of cars can be electric. The pollution and, if you believe it, CO2 from 1 billion new car drivers will be crazy.

[ImmanuelGoldstein]

The reactors and infrastructure to do all that will cost trillions and take decades. In that time tens of millions more petrocars will be sold.
I wouldn't worry about the threat of cheap third world cars. The cost of carworld will increase exponentially the more we try to export it. How many Indians and Chinese are going to be filling up those cars on $5,$6 or more gal. gas?

[mmm611]

Doesn't sound good for global warming!