China overtakes US as auto superpower

China is now the biggest car-buying place on the planet. Figures due to be released later this week by Chinese authorities are expected to show that more than 13.5 million cars were sold in China last year, compared to North America's tally of 10.4 million vehicles.

The results reflect a massive 46 per cent increase in sales in China from 2008 to 2009, compared to North America's figure which was the lowest recorded in 27 years, and a drop of 21 per cent when compared with 2008.

The result was bitter sweet for General Motors. GM and its joint venture manufacturers in China took market leadership there for the fifth year in a row, following a massive 67 per cent sales surge to reach a tally of 1.8 million sales.

In its domestic North American market General Motors sold a little more than 2 million vehicles, but this was a 30 per cent drop from 2008.

Indeed, without GM's growth in emerging markets such as China, Russia and India, the corporation might be in more financial difficulty than it already is.

However, the news is not all bad on the home front for North America's biggest brand. Sales of GM's domestic brands Chevrolet, Buick, GMC and Cadillac -- the four of its eight brands it is retaining -- were up by 13 per cent year on year. And the US market is showing signs of recovery, with sales increasingly slightly in the last quarter.

Meanwhile, China's new-vehicle market is expected to return to more modest growth in 2010.

The boss of General Motors China, ex-pat Australian Kevin Wale, formerly a senior Holden executive, told the Carsales Network: "We don't expect a repeat of 2009, it was absolutely crazy. We couldn't build enough cars. The market just kept building up and up through the year and we struggled to fit more [manufacturing] shifts in." He said the Chinese new-vehicle market would likely grow by about 10 per cent.

If China grows by 10 per cent, this would still put it comfortably ahead of the North American market as it continues to recover in 2010.

China's sales surge in 2009 was buoyed by government tax incentives on small vehicles and a comparatively low base in 2008, which slowed to single digit growth for the first time in at least 10 years according to the Xinhua news agency.

China's official sales data for 2009 is due to be released by the China Association of Automobile Manufacturers later this week. The expected tally of more than 13.5 million vehicle sales includes 650,000 heavy vehicles and trucks, but even if this figure was subtracted from the total, China would still be the world's biggest automotive market.

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