Auto sales in China may continue to grow slowly through the second quarter before rebounding in the second half, said Wang Dazong, president of Beijing Automotive Industry Holding Co.
“I think it will pick up later this year and end up about 10 percent,” Wang, who leads China’s fifth-biggest vehicle maker, said in an interview in New York yesterday. Beijing Auto is the Chinese partner of Daimler AG (DAI) and Hyundai Motor Co. (005380)
Chinese automakers are seeking to boost sales as competition rises at home, with foreign carmakers introducing local models, even after the nation ended tax breaks and subsidies that helped propel the country past the U.S. as the world’s largest auto market.
Deliveries of cars including multipurpose and sport-utility vehicles to dealerships rose 2.8 percent in April from a year earlier to 1.14 million units, the China Association of Automobile Manufacturers said. Sales may fail to increase by a previously estimated 10 percent to 15 percent this year, the industry group said last month.
“There is a limit as to how many vehicles Chinese consumers can buy in a month, and the 1.8 to 1.9-million level pretty much hit the ceiling at the current stage,” said George Yin, an analyst with BOC International in Beijing.
Sales Target
China’s total vehicle sales stood at 1.89 million units in January and 1.83 million in March, according to the automobile association.
Beijing Auto sold 1.49 million vehicles last year and aims to more than double sales to as many as 4 million by 2015. The company is investing 4.12 billion yuan ($634 million) to build manufacturing facilities for its own brand of cars in the Chinese capital, with construction expected to finish by the end of November, according to its website.
The automaker is using technology from Saab Automobile, for which it paid about 1.4 billion kronor ($221 million) in 2009, in its own-brand cars. Beijing Auto, which isn’t publicly traded, increased first-quarter profit 54 percent to 3.48 billion yuan, according to its website. The automaker made a profit of 11 billion yuan last year.
Beijing Auto makes Mercedes Benz E-class and C-class sedans with Daimler as well as Sonata sedans, Accent compacts and ix35 sport-utility vehicles with Hyundai Motor at their ventures.
Beiqi Foton Motor Co., Beijing Auto’s commercial-vehicle unit, formed a 6.35 billion yuan truck venture with Daimler last year. Foton also plans to work with the German automaker to target overseas sales.
