China auto industry lifts 2010 sales target to 16 mln units

China's auto industry has achieved great progress in the first seven months of 2010, and the industry's fixed-asset investments also maintained rapid growth. In addition, auto exports are still recovering slowly, according to statistics released by the China Association of Automobile Manufacturers on Aug. 9.

The association's Secretary General Dong Yang said the association has increased the 2010 auto sales target from 15 million to 16 million units, given China's promising auto market.

Statistics from the association show that the output value of China's auto industry totaled nearly 2.1 trillion yuan during the January-June period, up nearly 49 percent from last year, and the growth rate declined more than 5 percent compared to that of the January-May period.

Furthermore, the growth of economic benefits of 17 key automakers was largely consistent with that of the entire industry from January to June, and major economic indicators all experienced considerable growth over the same period of last year, but their year-on-year growth rates all dropped month by month.

The association believes that China's auto market is returning to a reasonable state. China's total auto production and sales volume exceeded 10 million units in the first seven months, with both growth rates down more 5 percent compared to the same period of last year. Meanwhile, the sales of passenger cars with 1.6-liter engines and under fell by nearly 2 percent from the first seven months of 2009, and by more than 1 percent compared to the full-year sales volume of 2009, which created a very grim situation.

The association's Deputy Secretary General Zhu Yiping said the auto market is normally slack in July and August, and the relatively considerable declines in auto production and sales volumes are consistent with past records.

"The overall growth rate of China's auto industry will gradually become reasonable and stable," Zhu said.

The association believes that the current auto inventory is at a reasonable level. According to its statistics, the total inventory of vehicles, excluding those on sale, reached 549,100 units as of the end of July. This is 44,400 more units than early July but 38,000 less units than early 2010. The inventory dropped slightly in May and June and rebounded a little in July.

Furthermore, the association also released a list of 10 domestic automakers with the 10 largest sales in the first seven months, which are the SAIC Group, Dongfeng Motor Corporation, FAW Group, Chang'an Automobile Group, Guangzhou Automobile Industry Group, Chery, BYD Auto, Brilliance Auto and JAC Motors. The 10 automakers sold an aggregate of over 8.8 million vehicles in the seven months, accounting for 86 percent of the national total.