China Could See Double-Digit Auto Sales Growth

Auto sales will not rise as quickly this year as in 2009, but can still easily grow by double-digits thanks to strong demand and stimulus policies, a government official said.

BEIJING (AP) -- China's auto sales will not rise as quickly this year as in 2009, but can still easily grow by double-digits thanks to strong demand and stimulus policies, a Commerce Ministry official said Friday.

China's total vehicle sales soared 45 percent last year to an estimated 13.6 million, overtaking the U.S. as the world's biggest auto market. Chang Xiaocun, who heads the "market construction" department at the ministry, concurred with earlier forecasts for total sales of at least 15 million this year.

U.S. sales of cars and light trucks plunged in 2009 to 10.4 million.

"Car sales certainly will rise, though there are different views about how much," Chang told reporters. "I expect an easy double-digit increase, though perhaps not as fast as last year," he said.

China will extend subsidies and other stimulus policies aimed at encouraging sales of vehicles, appliances and other big-ticket consumer products, Chang said, downplaying concerns that the economy might lose momentum as the year progresses.

He also insisted that the boom in vehicle purchases was driven by consumer demand, not mass government purchases.

"More than 90 percent of car sales last year were from civilian consumption, although I don't have exact numbers for government procurement," Chang said.

Chang said car purchases are driven by various motives, including farm, industrial and business use and also "luxury consumption."

"Last year's car sales were mainly driven by private demand," he said.

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