China beats US as biggest auto mart

SHANGHAI: Two years ago, China zoomed past Japan to become the world’s No 2 vehicle market. Now it looks poised to pass up the United States to be the biggest. While car sales in China have slowed lately, they haven’t plummeted like those in the US, where January sales tumbled 37% from a year ago to 656,976 vehicles, a 26-year low. Official Chinese auto data comes out next week, but January sales are expected to decline 8% to 790,000 units, Zhang Xin, an analyst at Guotai Junan Securities in Beijing, said Wednesday. “This is the first time in history that China has passed the US in monthly sales,” Mike DiGiovanni, General Motors Corp’s executive director of global market and industry analysis, said in a conference call late Tuesday. DiGiovanni projects that Chinese auto sales could hit 10.7 million vehicles in 2009, more than his estimate of 9.8 million unit sales in the US this year. Autodata Corp forecasts 2009 US sales at 9.57 million. General Motors, which last year surrendered its crown as world’s largest automaker by annual sales to Toyota Motor Corp, has a clear stake in China’s automotive future. GM is already is one of biggest automakers in China, with billions of dollars invested in joint ventures, and a record 1.09 million vehicles sold in 2008, up 6% from the year before. Like its global rivals, GM has been counting on the growth in China and other emerging markets to help offset losses elsewhere. China overtook Japan in 2006 to become the world’s second-largest vehicle market, thanks to strong sales to the country’s fast-growing middle class. With 1.3 billion people, China was bound to catch up with the US population 300 million at some point, but the dramatic contraction of the American market could make that happen sooner than expected. Of course, if US sales recover strongly in coming months, outpacing those in China, the American market would remain the world’s biggest.