Sales of used cars forecast to increase

CHINA'S used car market is expected to speed ahead in the next two years, according to a forecast by the China Association of Automobile Manufacturers.
A previous report said China's used car dealers are expecting business to surge ahead of last year as nearly 36 percent of current car owners plan to buy either a new or used vehicle.
    
The association said that more than 1.9 million used cars were traded in China last year, up 31.5 percent from 2005.

The growth rate was 6.37 percentage points higher than that of new car sales. It was the third consecutive year that used car sales growth outpaced the expansion of new cars.

In China, three out of four automobiles sold are new while in the United States, the world's biggest auto market, the sale of used cars is two to three times higher than new cars.

Only 30 out of every 1,000 Chinese own a car, much lower than the world average of 120.

As the cars of first time buyers age, owners will buy new replacements and sell their old vehicles, creating a new market, said Yu Yuanbo, vice chairman of the China Auto Dealers Association.

US-based Manheim Auctions, the world's leading auction company of used vehicles, held its second joint venture auction in Shenzhen last month. Its first was held in Shanghai in November.

Neville Green, president of the joint venture, predicted China's used car sales could exceed six million annually by 2011.
    
The China Association of Automobile Manufacturers said new car sales hit 7.22 million last year, up 25 percent year-on-year.