GM China Q1 passenger car sales down 9% y/y

General Motors Corp, which is struggling to avoid bankruptcy in the United States, has said first-quarter sales in its Chinese passenger car venture slid 9 percent from a year earlier amid weak market demand.

Sales of Shanghai General Motors Co, GM's venture with Shanghai Automotive Industry Corp, dropped to 117,000 units for the first three months of this year, compared to 128,649 a year earlier.

South Korea's Hyundai Motor Corp, including its affiliate Kia, boosted its sales by 39.9 percent to 110,488 units during the same period in China.

"Shanghai GM has been reducing its stocks and sales of the revamped Buick Excelle are lower than the previous model," said Tan Jijia, an analyst from Pacific Securities Co. "But some new models are helping it ride out of the recession."

Shanghai GM said its first-quarter sales grew 12.9 percent from the fourth quarter last year, benefiting from new models in its Buick family. It launched a remodeled Buick Regal and the new Buick Enclave sport utility vehicle at the end of last year as part of its efforts to restructure an aging product line-up.

Last month saw 6,150 Buick Regals and about 2,250 Buick Enclaves sold, accounting for 60 percent of its full-year target.

Meanwhile, sales of the Buick Excelle, Shanghai GM's mainstream model, reached 47,000 units for the first quarter, benefiting from the tax breaks offered on small cars.

Shanghai GM said its business had not been affected despite the Obama administration's rejection of GM's bailout plan and possible liquidation if the ailing car maker failed to carry out more intensified restructuring.

Sales of Shanghai GM fell 7 percent last year because of the slowing economy while China's overall vehicle sales gained 6.7 percent, the slowest pace in a decade.