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Second Largest Automobile Market February 20, 2007

Posted by David in China.

According to a Xinhua report (19-02-2007) China’s automobile industry made a profit of approximately US$10 billion in 2006, “up 46 percent from the previous year”. These figures, and those following, are “from the China Association of Automobile Manufacturers (CAAM).”

“In 2006 China’s auto industry sold 7.22 million auto vehicles, increasing 25 percent over 2005, and the country overtook Japan for the first time to become the world’s second largest auto market.” No doubt a huge population and an ever increasing number of Chinese people with higher (and disposable) incomes have been of great help to the industry.

The report goes on to state that “China’s auto industry has been developing rapidly in recent years, mainly driven by sharply increased individual buyers. In 2006 more than 100 new sedan models hit the country’s market, including 36 home-grown brands.”

However, it’s not all good news. “China has about 1,500 registered auto producers, of which fewer than 100 sold more than 10,000 vehicles last year. Many small manufacturers sold only 300 to 500 vehicles.” Still this entire market, and related sectors, has great potential. This is why so many foreign companies are quickly entering China.

For example, as mentioned in Taipei Times (20-02-2007) “Japanese transportation provider Nippon Express has linked up with a logistics subsidiary of Chinese automaker Dongfeng Motor”.

They are “targeting the growth in the Asian economic powerhouse,” and recently “started transporting auto parts for a venture firm jointly created by Dongfeng Motor Group Co and US engine manufacturer Dongfeng Cummins Engine Co. ” They will “initially offer shipping services for 13 autoparts suppliers in Hubei Province and expand the operation to other auto-related sectors in China.”

This is Nippon Express’ “first full-scale tie-up with a shipping company affiliate of a Chinese automaker,” and if all continues to go well with China’s economy (and the relationship between both states) not likely their last.



1. Anna - March 17, 2007

In the southeast Asia a lots of chine auto, china auto product is more competitive (charge)

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