roewe 750.jpgGiven the dire state of western car markets, it would be difficult for China not to romp home with the top sales spot this year.

Nevertheless, it must give food for thought to many carmakers in the west to see how rapidly China has emerged and that it is now poised to overtake the US as the world's biggest car market.

China's passenger-vehicle sales rose 47% in May, the biggest jump since February 2006, as tax cuts and government subsidies helped extend the country's lead over the US as the world's biggest car market.

Overall vehicle sales rose 34% to 1.12m of which 829,000 were cars, sport-utility vehicles and other passenger vehicles .

A combination of subsidies for rural areas and cuts on car taxes has helped boost demand for cars in china and through their JVs, the western carmakers have been one of the biggest beneficiaries. General Motors, the largest western carmaker in China, saw sales rise 34% in the first five months of 2009, while Volkswagen, another big player, sold 45% more vehicles in China in May.

For the year, analysts believe the Chinese market will grow around 10%, while the US market seems poised to decline 23% and Europe around 15%.

So, China is clearly the place to be if you are a western carmaker. However, the Chinese domestic carmakers are no longer prepared to let the foreign firms do all the running and their share of the market grew from 26% to 30% in Q1.

Lots more automotive stories here.

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