China car sales shrink for a second month

October 10, 2008

China's passenger car sales shrank for a second month in a row in September, official data showed on Friday, as a slowing economy slammed the brakes on fast-growing demand in the world's second-largest vehicle market.

Car sales fell 1.44% in September from a year earlier to 552,800 units, according to the China Association of Automobile Manufacturers, the country's official industry association.

The data followed nine-month figures from two major automakers showing a marked slowdown in growth from last year.

Ford Motor's vehicle sales in China climbed 7.13% in the first three quarters of the year from the same period a year earlier, compared with 30% growth during that period last year.

Top European car maker Volkswagen AG posted 13.1% sales growth in mainland China, Hong Kong and Macau during the first nine months of the year, compared with 30% growth during the same period a year ago.

Industry researcher J.D. Power and Associates, in a report on Thursday warning of a collapse in the global auto market next year under the weight of the credit crisis and economic stress, forecast China auto sales growth this year at 9.7%, down sharply from last year's 24.1%.

September's China sales drop followed a 6.2% decline in August, which marked a stunning reversal for an industry that had grown accustomed to years of double-digit sales growth.

In addition to the slowing economy, higher fuel prices and the Beijing Olympics had also been blamed for keeping customers from showrooms.

Reuters

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