Car sales slow in China

BEIJING (AP):China's auto-sales growth tumbled to seven per cent in January amid an economic slowdown and curbs imposed to fight smog and traffic.

Drivers in the world's biggest auto market bought 1.85 million passenger vehicles, the China Association of Automobile Manufacturers said last Thursday. It was the first time monthly sales surpassed 1.8 million.

Auto-sales growth is forecast to decelerate sharply from last year's 15.7 per cent expansion to about eight to 10 per cent. Sales grew 17 per cent in December.

Chinese leaders see auto manufacturing as a driver of economic development. But rapid growth has left Beijing, Shanghai, and other major cities choking on smog. Some cities have responded by limiting the number of new-vehicle registrations.

Zhang Xin, an industry analyst for Guotai Junan Securities, said the figures were "pretty good" despite the decline from December's double-digit growth. "Sales probably were boosted by rumours of sales restrictions in some big cities. The longer the rumours last, the better sales will be," he said.

heavy competition

China's auto market is the world's most crowded, with major global auto-makers and dozens of small Chinese brands jostling for sales. Intense competition is squeezing indigenous Chinese auto-makers that have less advanced technology, especially as sales growth slows.

Earlier, General Motors Co said sales of GM-brand vehicles by the company and its Chinese partners in January rose 12 per cent to a monthly record of 348,061. Ford Motor Co said sales rose 53 per cent over a year earlier to 94,466 vehicles.

BMW AG, Europe's biggest luxury auto-maker, said deliveries in China rose 22.2 percent to 37,137 vehicles.

Nissan Motor Co said sales of Nissan vehicles by the company and its local partners were off 0.4 per cent at 95,200. Toyota Motor Co said sales rose 118.1 per cent to 85,600 vehicles.

South Korea's Kia Motors Corp said sales rose 8.5 percent to 40,173 vehicles.

Newcomers still are piling into China's glutted market. France's Renault SA signed an agreement in December to open its first Chinese factory with a local partner in hopes of offsetting sagging European demand. The company says it will have a production capacity of 150,000 vehicles a year.