China car makers unlikely to meet '08 goal

CHINESE car makers may find it more difficult to achieve their sales target this year after the rise in vehicle exports reversed sharply as the ongoing financial turmoil dented overseas orders, said an industry body yesterday.

Exports of completed cars, which soared rapidly over the past few years, jumped 34.71 percent to 557,500 units in the first nine months of this year, the China Association of Automobile Manufacturers said in a statement yesterday, citing statistics from China Customs. But the growth is 29.3 percentage points lower than that of the same period last year. CAAM said overseas deliveries for August and September declined year-on-year.

Although the value of exports in the first three quarters accelerated 58.39 percent from a year earlier to US$7.6 billion, the growth was actually halved from the same period last year.

"The impact of the financial crisis on the US market is hitting China's auto exports and driving the industry into a tough time," said Xu Changming, senior economist at the Information Resource Department of State Information Center.

"Firstly, the weak market demand for vehicles in the US market will trim China's exports of auto parts. More importantly, the turmoil would hurt the economies of Russia and Middle East countries, which are the main export destinations of China's auto makers," Xu said.

Major domestic vehicle exporters such as Chery Automobile Co Ltd and Great Wall Motor Corp also pointed out that the rapid appreciation of the yuan and a rise in raw material prices were two constraints on exports.