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GM Anticipates High Growth In China
May 07, 2007

Automobile producer General Motors is anticipating positive growth in China passenger car market coupled with favorable economic conditions and market offerings that suit the need of people.

As per the report “China Automobile Industry Forecast (2006-2010)” published by RNCOS “China’s automobile industry is rising as a prominent player in global automobile market from the viewpoint of both, demand and supply side. Registration of passenger vehicle is expected to rise by 11% CAGR to reach 4.8Mn units by year 2010”.

General Motors is also anticipating car sales in China to become one million cars this year after a promising first-quarter performance because of robust passenger car demand, state media said in news published on
BrisbaneTimes.

Kevin Wale, Detroit-based General Motor's China chief, envisages that China's vehicle sector will develop at a double-digit rate this year advanced by sturdy passenger car requirement. Sales of vehicles made in China in the first quarter increased by 22.2 percent to 2.12 million, with passenger car sales rising up from 28.5 percent to 1.25 million.

Escalating passenger car sales remains principal aspect for mounted vehicle sales in China. At the back of this augmentation in China's automobile sales was the sustained price depreciation along with introduction of larger number of smaller, cost effective car models consequential in escalating number of consumers affording them.

There’s growing evidence of rising costs of fuel to be the primary cause of sales of smaller, increased fuel-efficient subcompact cars. The increasing number of model introduced in market is also creating robust sales through increasing affordability.

China's economic growth rate also adds to this escalated affordability of people with them encompassing more disposable income. In addition, more car models are spurring the sales growth for greater affordability. The rising trend in auto production and sales is also attributed to urban migration.

Chinese government has also persuaded banks to provide personal car loans and lower taxes by permitting private car duties to be determined by public tenders.

Industry experts consider, sales of passenger cars in China will maintain a speedy growth for not less than 20 years, and growth is projected to be at 15-20 percent in next 10 years. Moreover, Industry experts envisage that people with middle-level income would be able to have funds for cars by 2009.

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