China's imported auto sales may grow 20% this year

Shanghai, February 3 (Gasgoo.com) Sales of imported vehicles in China are likely to grow 20% to more than 420,000 units this year, Shanghai Daily reported today, citing an industry insider.

After a sales increase of more than 40% since 2006, growth in China's sales of imported vehicles slowed to 31% last year at 353,000 units, mainly due to financial crisis and higher sales tax on imported cars with larger engines. Auto imports at customs rose only 2.8% to 419,000 units in 2009.

Of the imported auto sector, sport-utility vehicles (SUVs) contributed the most to the growth. Last year, SUV imports rose 37% and accounted for 54.8% of the total imported vehicles. Imported vehicles sold in second and third-tier cities took up 53% of the total.

China's auto imports began to rebound later last year, thanks to economic recovery and higher demand in inland cities, said Ding Hongxiang, chairman of China Automobile Trading Co. This year's imported auto sales may exceed 420,000 units, up 20%.

"While carmakers have increased local production, imported vehicles still appeal to buyers for individual features," Ding said. "Demand in big cities will also recover, and carmakers will focus on vehicles with mid-size engines this year."