Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
S&P 500 – Is a 5% Correction Enough? - 6th Dec 21
Global Stock Markets It’s Do-Or-Die Time - 6th Dec 21
Hawks Triumph, Doves Lose, Gold Bulls Cry! - 6th Dec 21
How Stock Investors Can Cash in on President Biden’s new Climate Plan - 6th Dec 21
The Lithium Tech That Could Send The EV Boom Into Overdrive - 6th Dec 21
How Stagflation Effects Stocks - 5th Dec 21
Bitcoin FLASH CRASH! Cryptos Blood Bath as Exchanges Run Stops, An Early Christmas Present for Some? - 5th Dec 21
TESCO Pre Omicron Panic Christmas Decorations Festive Shop 2021 - 5th Dec 21
Dow Stock Market Trend Forecast Into Mid 2022 - 4th Dec 21
INVESTING LESSON - Give your Portfolio Some Breathing Space - 4th Dec 21
Don’t Get Yourself Into a Bull Trap With Gold - 4th Dec 21
GOLD HAS LOTS OF POTENTIAL DOWNSIDE - 4th Dec 21
4 Tips To Help You Take Better Care Of Your Personal Finances- 4th Dec 21
What Is A Golden Cross Pattern In Trading? - 4th Dec 21
Bitcoin Price TRIGGER for Accumulating Into Alt Coins for 2022 Price Explosion - Part 2 - 3rd Dec 21
Stock Market Major Turning Point Taking Place - 3rd Dec 21
The Masters of the Universe and Gold - 3rd Dec 21
This simple Stock Market mindset shift could help you make millions - 3rd Dec 21
Will the Glasgow Summit (COP26) Affect Energy Prices? - 3rd Dec 21
Peloton 35% CRASH a Lesson of What Happens When One Over Pays for a Loss Making Growth Stock - 1st Dec 21
Stock Market Sentiment Speaks: I Fear For Retirees For The Next 20 Years - 1st Dec 21 t
Will the Anointed Finanical Experts Get It Wrong Again? - 1st Dec 21
Main Differences Between the UK and Canadian Gaming Markets - 1st Dec 21
Bitcoin Price TRIGGER for Accumulating Into Alt Coins for 2022 Price Explosion - 30th Nov 21
Omicron Covid Wave 4 Impact on Financial Markets - 30th Nov 21
Can You Hear It? That’s the Crowd Booing Gold’s Downturn - 30th Nov 21
Economic and Market Impacts of Omicron Strain Covid 4th Wave - 30th Nov 21
Stock Market Historical Trends Suggest A Strengthening Bullish Trend In December - 30th Nov 21
Crypto Market Analysis: What Trading Will Look Like in 2022 for Novice and Veteran Traders? - 30th Nov 21
Best Stocks for Investing to Profit form the Metaverse and Get Rich - 29th Nov 21
Should You Invest In Real Estate In 2021? - 29th Nov 21
Silver Long-term Trend Analysis - 28th Nov 21
Silver Mining Stocks Fundamentals - 28th Nov 21
Crude Oil Didn’t Like Thanksgiving Turkey This Year - 28th Nov 21
Sheffield First Snow Winter 2021 - Snowballs and Snowmen Fun - 28th Nov 21
Stock Market Investing LESSON - Buying Value - 27th Nov 21
Corsair MP600 NVME M.2 SSD 66% Performance Loss After 6 Months of Use - Benchmark Tests - 27th Nov 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

China Auto Market Will Continue to Drive Sales for Western Manufacturers in 2011

Companies / US Auto's Dec 23, 2010 - 06:09 AM GMT

By: Money_Morning

Companies

Best Financial Markets Analysis ArticleDon Miller writes: The world's largest carmakers, including Toyota Motor Corp. (NYSE ADR: TM), General Motors Co. (NYSE: GM) and Volkswagen AG, expect China's red-hot economy to keep auto sales rolling at a record pace in 2011, making it the third year in a row the Red Dragon will top the U.S. in car sales.

China's vehicle sales jumped 46% in 2009, dethroning the United States as the world's largest auto market and ending more than a century of American dominance that started with the Model T Ford.


The nation's sales of passenger cars, buses and trucks rose to 13.6 million in 2009, the fastest pace in at least 10 years, according to the China Association of Automobile Manufacturers. At the same time, U.S. sales tumbled 21% to 10.4 million, the lowest level since 1982, according to Autodata Corp.

China's vehicle sales have surged since 1999 as its gross domestic product (GDP) growth averaged more than 9% a year, helping U.S. automakers make up for slumping demand in the West. China's vehicle sales surged 30.45% in the first half of the year to 7.18 million units, compared to 5.6 million for the United States.

"China is becoming the center stage of development for the 21st century global auto industry," Bill Russo, a Beijing- based senior adviser at Booz & Co., told Bloomberg. "Economic growth has directly translated into growth in automobile sales."

Fatih Birol, chief economist for the International Energy Agency (IEA) says that today 700 out of every 1,000 people in the United States and 500 out of every 1,000 in Europe own cars. But in China, only 30 out of 1,000 people own cars. And Birol thinks that figure could jump to 240 out of every 1,000 by 2035.

The China's automobile market is expected to grow by 15% in 2011, and sales growth at GM is expected to match that pace, according to GM's China President Kevin Wale.

Volkwagen AG (PINK: VLKAY), Europe's biggest auto manufacturer expects its sales to grow 10-15%, but remain constrained by a shortage of capacity, according to Soh Weiming, the company's executive president for China.

"I would anticipate nothing less than that and we will grow together with the market," Soh told Bloomberg News in an interview at an auto conference in Guangzhou, China on Monday.

Toyota, the world's largest automaker, said it expects its China sales to rise 13% to 900,000 vehicles in 2011. And Nissan Motor Co. Ltd. (PINK: NSANY) projects its sales will rise 17% to 772,000 units.

Even though Beijing is set to withdraw heavy incentives this month that helped boost its auto sales by 34% to 16.4 million through November, car sales growth in China is expected to again surpass the United States in 2011.

Auto sales in China may hit a whopping 20 million in China in 2011, according to data compiled by Booz & Co.

Meanwhile, light-vehicle sales in the United States could reach as high as 12.8 million units, Ashvin Chotai, managing director of auto consultant Intelligence Asia Automotive, told Bloomberg.

Excluding trucks and buses, Chinese passenger-car vehicle sales reached 12.45 million through November this year.

Even though China has stretched its lead over the United States and other markets, the elimination of subsidies and capacity bottlenecks are slowing the pace of growth.

GM and its joint ventures increased vehicle sales in China by 33% over a year ago to 2.2 million vehicles in the first 11 months of this year, the company reported earlier this month. VW-owned brands sold 1.8 million vehicles in China through November, an increase of 38% from a year earlier.

A shortage of manufacturing capacity will constrain VW's ability to meet demand in the nation, Soh told Bloomberg. The Wolfsburg, Germany-based automaker has said it will spend $14 billion (10.6 billion euros) through 2015 to build two factories to supplement the nine it currently operates in China, boosting production to 3 million cars annually.

"The next 24 months will be tough for us as we have production constraints," Soh said. "VW's biggest challenge to growing sales is limited capacity in China."

Hyundai Motor Co. (PINK: HYMLF), which projects sales will grow just 2.9% in 2011 to 720,000 units, will also be limited by a lack of capacity, Noh Jae-man, president of the automaker's Chinese operations told Bloomberg.

Seoul-based Hyundai intends to build its third Chinese factory as it strives to boost Chinese capacity by 50% to 900,000 vehicles a year by 2011. Ford Motor Co. (NYSE: F) is spending $490 million on a third plant in China.

Source : http://moneymorning.com/2010/12/23/...

Money Morning/The Money Map Report

©2010 Monument Street Publishing. All Rights Reserved. Protected by copyright laws of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), of content from this website, in whole or in part, is strictly prohibited without the express written permission of Monument Street Publishing. 105 West Monument Street, Baltimore MD 21201, Email: customerservice@moneymorning.com

Disclaimer: Nothing published by Money Morning should be considered personalized investment advice. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investent advice. We expressly forbid our writers from having a financial interest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication, or 72 hours after the mailing of printed-only publication prior to following an initial recommendation. Any investments recommended by Money Morning should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company.

Money Morning Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in