BIZCHINA> Auto Industry in China
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BIZCHINA> Auto Industry in China
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Market maneuvers in China's auto industry
(China Daily)
Updated: 2006-11-20 16:20 1. Sizzling market growth China's vehicle market has regained strong growth momentum this year after a slow pace the past two years, beating estimates of most industry analysts. In the first three quarters of this year, sales of domestically-made vehicles grew by a quarter to 5.17 million units with car sales rocketing by more than 30 per cent. Full-year sales are expected to total 7 million units, enabling the country to dwarf Japan as the world's second biggest vehicle market. Sales in 2005 and 2004 rose by 13.5 per cent and 15.5 per cent respectively. Both of the growth rates in 2003 and 2002 were above 30 per cent. 2. SAIC appointment SAIC in June hired Phil Murtaugh, former chairman and chief executive officer of GM China Group, as its executive vice-president. Murtaugh, 51, takes the helm of SAIC's international operations. The company expects Murtaugh, who has more-than-30-years experience in the automotive industry, to help it branch out in the overseas market. Murtaugh quit his post at GM China Group in April last year. He started at GM China Group in 2000. SAIC has a 10 per-cent stake in GM Daewoo Auto & Technology Co and a 48.9-per cent share in Ssangyong Motors Co from South Korea. Last year, SAIC sold a total of 1.05 million vehicles. Foreign brains like Murtaugh are badly needed for Chinese automakers planning to expand in the overseas market. 3. Import tariff dispute China in August decided to postpone by two years a plan to impose high tariffs on some imported auto parts to help solve an auto trade dispute with the European Union (EU) and United States. The plan will not be implemented until July 1, 2008. According to the delayed plan, imports of auto parts and components will be treated as built-up vehicle imports and be imposed with a tariff of 25 per cent if these auto parts and components consist of 60 per cent or more of a vehicle assembled in China. However, the EU, US and Canada jointly lodged a complaint against China with the World Trade Organization (WTO) in September. They claimed China's policy on auto parts and component imports violate its WTO commitments and demanded an investigation. A team was launched last month. But a spokesman from the Ministry of Commerce said China's plan did not violate WTO rules and is aimed at curbing tax evasion instead. On July 1, China slashed tariffs on built-up vehicle imports to 25 per cent from 28 per cent and tariffs on imports of spare parts to 10 per cent from 13.8-16.4 per cent to complete its WTO commitments. (For more biz stories, please visit Industries)
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