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China - Car Sales Reached 3.02 Million Units during January-May 2008
Aug 11, 2008

Due to growing economy and increasing consumer demand, the Chinese auto industry sold about 3.02 Million units in first five months of 2008, says CAAM.

The CAAM (Chinese Association of Automobile Manufacturers) said that 3.02 Million cars were sold in China from January to May 2008, with 93,200 MUV (Multi-Utility Vehicles), 179,200 SUV (Sports-Utility Vehicles) and 2.23 Million sedans, as XinhuaNet
reported.

According to CAAM, passenger car sales in the country increased by about 17.41% during January-May 2008 from January-May 2007. Passenger cars, MUVs and SUVs recorded sales of 564,600 units in May 2008, an increase of nearly 16% as compared to May 2007. This growth rate was more than 11% in April 2008. Also, CAAM forecasts that automobile sales in the country are anticipated to increase by nearly 14% and reach more than 10 Million units this year.

The growing Chinese middle class, which is becoming wealthier and buying more cars to show their status, is identified as the major reason for the growth of the Chinese automobile sector. Also, due to an increase in status level, Chinese consumers are looking for convenience and comfort. The rise in employment and disposable income is also resulting in an increase in the auto sector of the country.

Moreover, rising population is fuelling the growth. The booming industrialization is also encouraging the use of more transportation facilities and increasing the demand for vehicles and thus, a rise can be seen in Chinese automobile sector. However, in comparison to the population, number of cars is still less in China as compared to other countries, representing ample growth opportunities for the Chinese auto industry.

The rapidly growing auto industry of China is encouraging many foreign players to introduce their vehicles in the country. Thus, this is not only increasing the competition in the Chinese automobile sector, but is also providing more choices to the consumers.

A Senior Research Analyst at RNCOS
said “Due to increasing consumer demand and improving economic conditions, Chinese auto sector is witnessing rapid growth. Thus, it is giving more opportunities to investors in the country. Also, the booming auto sector is improving the economic conditions of the country.”

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