Domestic auto market VS oil prices rising

　　It is reported the declination of United States distillate inventories exceeds expectation and the gasoline supply is reduced too. By 18th this month, in the international market oil prices increase to more than 79 U.S. dollars a barrel, the highest within recent five weeks.

　　Before the Chinese new years, several experts have predicted the sales of domestic automobile market will break 1.7 million in 2010. However, special factors, such as economic changes and policy adjustments can still influence the sales directly. Purchase tax policy for small-displacement Vehicle has been adjusted this year. The intention to encourage low-emission cars and limit high-emission ones remains clear. As the oil prices are expected to rise increasingly, the low-emission car will continue to be main force of auto mark.

　　Although the purchase tax preference has shrunk, the prosperity of domestic auto market is kept on this year. The sales are expected to hit record high. According to the latest statistics released by the China Passenger Car Association, in January the production is 995, 000 units, a growth of 138.8% from a year before and 1.0% from last month while the sales has reached 972, 600, a growth of 83% but a declination of 1.7% from last month, demonstrating the sales continue to grow at a high speed. Despite the purchase tax preference has shrunk the manufacturers meet market demand through purchase tax subsidies and production promotion. Whether these measures will be carried on depends on the situation.

　　The increasing oil prices will more or less have an impact on the car buyers. While consumer expectations are improved, many people have to delay buying behaviors. According to one survey, a large number of consumers do put off purchasing cars due to hundreds of extra budget of the rising oil prices. Besides, a credit crunch influences auto sales directly. Consequently, in 2010 the sales may not be as well as expected.

　　Low-emission cars benefit while high-emission ones suffer

　　The automotive industry is a pillar industry which can affect domestic economic indicators directly. This is the significant reason for the government to continuously adjust the policies to stimulate the sales. Of course, the scope of the adjustments should be confined within the expectation to avoid the ups and downs in the automobile market. Market share of small-displacement cars may grow constantly in the next few years.

　　Influenced by the purchase tax policy since this year, the sales of most high-emission models are rather moderate. In addition, the rising oil prices add to the misfortunes of high-emission cars. The manufacturers have to modify these gas-guzzler models to low-power and high-performance sedans.

　　Domestic oil prices is likely to be improved

　　Usually, oil prices in our domestic market will timely follow up the international market when rising, but delay response when declining. Recently, oil prices topped 79 U.S. dollars a barrel last week, it seems logical for the oil prices to be improved in domestic market according to the formation mechanism of refined oil prices.

　　(Translator: yalong/ Jessie)

　　See original Chinese report Please click:

　　http://yiruocompany.blog.sohu.com/144778099.html