Commercial and heavier transport save decline in data for first four months
Sales of passenger cars in the mainland fell in the first four months of the year, as rising materials costs and competition drove down prices and profits.
Figures published yesterday by the China Auto Industry Association showed vehicle sales in the four months of 1.803 million units, up 1.57 per cent over the same period last year. But just 1.14 million passenger cars were sold, down a comparative 0.62 per cent.
Last month, the top five producers - First Auto Group, Shanghai Auto Industry Group, Dongfeng Auto, Beijing Auto and Changan Auto - accounted for 67 per cent of sales. Except for First Auto, all posted sales drops in the month compared with March.
Growth in the market is slowing dramatically, from an annual 40 per cent in 2002 and 2003 and 14 per cent last year, while the leading companies are expanding capacity, raising fears of a production glut.
'I am not optimistic for 2005,' said Xu Xiang, an analyst with Southern Securities. 'The rate of increase will continue to fall. I forecast an increase of 5 per cent overall in this market this year.
'Most promising are medium-size and large commercial vehicles and least promising are passenger cars, where I see falling prices and profits, as the cost of raw materials rises,' he said.
