China automakers face tougher 2010
Wednesday, 6 January 2010
SHANGHAI, Jan 5 (Reuters): Chinese automakers are gearing up to tackle tough foreign markets, after a landmark 2009 when they zoomed on to the global stage with several deals and their home market overtook the United States as the world's largest.
Figures due later this week are expected to show China auto sales soared 44 per cent to 13.5 million units in 2009, according to the average forecast of five analysts polled by the news agency.
Light vehicle sales, mainly passenger cars, are expected to have topped 12.75 million units, well ahead of a four-decade low of 10.3 million in the United States, according to recent forecasts from JD Power's Asia Pacific division.
The huge jump for China came as Beijing rolled out a number of incentives to boost sales as part of its 4 trillion yuan ($586 billion) stimulus package during the global downturn.
The year saw a trio of obscure Chinese names -- Zhejiang Geely Holding Group, Beijing Automotive Industry Holding Co (BAIC) and Sichuan Tengzhong Heavy Industrial, make moves to buy all or parts of storied global brands Volvo, Saab and Hummer.
But now comes the hard part, as Chinese automakers try to turn around their loss-making purchases as they move into unfamiliar foreign markets, even as growth in their overcrowded home market slows.
"This is really an extraordinary year for Chinese automakers, but they still have a long way to go to become a truly global player," said Boni Sa, an analyst with industry consultancy CSM Worldwide.
On the home front, the scale-back of aggressive tax cuts that fueled last year's explosive growth could slow growth at some companies, even as industry watchers stay sanguine on the broader outlook.
"Mercedes-Benz are not covered by the stimulus measures. But our sales are very good this year because market sentiment has been strong," said Klaus Maier, president and CEO of Mercedes-Benz's China operations.
Figures due later this week are expected to show China auto sales soared 44 per cent to 13.5 million units in 2009, according to the average forecast of five analysts polled by the news agency.
Light vehicle sales, mainly passenger cars, are expected to have topped 12.75 million units, well ahead of a four-decade low of 10.3 million in the United States, according to recent forecasts from JD Power's Asia Pacific division.
The huge jump for China came as Beijing rolled out a number of incentives to boost sales as part of its 4 trillion yuan ($586 billion) stimulus package during the global downturn.
The year saw a trio of obscure Chinese names -- Zhejiang Geely Holding Group, Beijing Automotive Industry Holding Co (BAIC) and Sichuan Tengzhong Heavy Industrial, make moves to buy all or parts of storied global brands Volvo, Saab and Hummer.
But now comes the hard part, as Chinese automakers try to turn around their loss-making purchases as they move into unfamiliar foreign markets, even as growth in their overcrowded home market slows.
"This is really an extraordinary year for Chinese automakers, but they still have a long way to go to become a truly global player," said Boni Sa, an analyst with industry consultancy CSM Worldwide.
On the home front, the scale-back of aggressive tax cuts that fueled last year's explosive growth could slow growth at some companies, even as industry watchers stay sanguine on the broader outlook.
"Mercedes-Benz are not covered by the stimulus measures. But our sales are very good this year because market sentiment has been strong," said Klaus Maier, president and CEO of Mercedes-Benz's China operations.