Total car sale was 7.18 million in half

　　In the first half of 2010, China’s national economy achieved a stable development, purchasing power of Chinese consumers increased, purchase tax reduction continued and subsidies for fuel-efficient and new energy cars were announced. A series of favorable policies helped China’s auto industry kept its rapid growth in the first half of 2010.

　　Output and sales respectively increased by 44% and 30% year on year

　　Chinese government issued a series of favorable policies which played an important role in promoting rapid growth of Chinese car market that year. The growth tendency and continued favorable effect helped Chinese car market kept its stable growth. During the recent half a year, China’s auto industry achieved a high opening and stable development situation. Sale of January was great with output reached more than 1.5 million units. In March output reached the highest monthly level with a nearly 1.7 million units output. After that, impacted by slump of terminal sales, output began declining gradually month by month and year on year increase tended to be stable. Cumulative output and sales were respectively 8.4722 million and 7.1853 million units, cumulative up 44.37% and 30.45% compared with the same period of last year. Taken inventory cycle into account, inventory cycle increased month by month from 41 days in February and to 55 days in June, which impacted heavily on cash flow for auto enterprises and dealers.

　　Cumulative output and sales of passenger cars were respectively up 45% and 25%

　　Cumulative output and sales of passenger cars were respectively 6.2695 million and 5.4175 million units, cumulative up 45.03% and 25.58% year on year.

　　As the main force of passenger cars, output and sales of sedans accounted for 70% of passenger car output and sales. Good performance of sedans provides rapid development of China’s passenger car market with a good foundation. Total sale of sedans in the first of half 2010 was 3.9484 million units, up 25.08% compared with the same period of last year. Among them, cumulative sales of 1.6 liters and below were 2.6313 million units, which accounted for 66.64% of total sedan sales and down 0.93% compared with same period of last year. This was linked to positive effect of purchase tax reduction policy diminishing. Sale of China's own brands in the first half was 1.1257 million units, accounting for 28.51% of sedan sales and up 1.44% compared with the same period of last year. In 2009, stimulated by policies including implementation of fuel tax, car purchase tax reduction and car to the countryside, cross-type passenger car market achieved an explosive growth, which helped passenger cars become popular model in Chinese car market. Terminal sales of cross-type passenger cars declined gradually n the first of 2010 and led to decline of output month by month. Cumulative output and sales of cross-type passenger cars in the first half of 2010 were respectively 1.2010 million and 932,800 units, up 31.64% and 6.38% compared with the same period of last year respectively.

　　In 2010, demand for SUV market was great because rapid economic growth and improving purchase power of Chinese consumers. Cumulative output and sales of SUV in the first half of 2010 were respectively 424,900 and 373,900 units, which respectively increased by 100.08% and 87.06% year on year. China's own brands, joint venture brands, imported brands dominate China's SUV market. Taken market situation of SUV market from January to May into account, shares of them were respectively 23.62%, 47.15% and 29.23%. Inadequate commercial activities in 2008 impacted performance of domestic MPV market severely. Growth rate of MPV market in the first half of 2009 still fell behind overall growth rate of passenger car market and it was the last car model which got out of downturn period finally. In the first half of 2010, with emerging of MPV market sales potential and adequate commercial activities, performance of MPV market was outstanding. Cumulative output and sales of MPV were respectively 189,400 and 162,400 units in the first half of 2010, which respectively increased by 136.68% and 101.47%.

　　Output and sales of commercial vehicles increased by 4% year on year

　　Macro economic environment, policy environment and external demand are the main factors that impact development of commercial vehicle market. In early 2010, rapid growth of China's national economy, obvious improvement of logistics industry, constant increasing demand for passenger transportation and massive investment put into effect promoted hot sales of commercial vehicles. In April, sales of commercial vehicle nearly reached 400,000 units, the highest level compared with the same period in the history. However, with release of Chinese consumers' demand, commercial vehicle market met downturn since May. In the first half of 2010, cumulative output and sales of commercial vehicle were respectively 2.2027 million and 1.7677 million units, up 42.54% and 48.05% respectively compared with the same period of last year.

　　Despite Chinese government issued policies including car to the countryside and auto replacement, their stimulation on truck market was slight and performance was flat. As the mainstream model of truck, demand for light truck can severely impact truck market situation. Cumulative output and sales of trucks were respectively 809,000 and 661,700 units, up 32.60% and 29.76% respectively year on year.

　　Semi-trailer tractor is mainly used to take up medium and long-distance cargo transportation operations. Situation of logistics industry has been in good performance since 2009 and semi-trailer tractor market grew rapidly though it showed cyclical fluctuation. Output and sales of semi-trailer tractor were respectively 188,400 and 172,000 units, up 149.27% and 237.69% respectively compared with the same period of last year. As China's urbanization and industrialization process speeding up, special car market has been in rapid development. Special car mainly includes models such as dump truck, frontal, warehouse gate truck, tank truck and other special cargo transportation models. Dump truck is mainly used for loading and unloading operations and medium-sized civil engineering. Due to massive construction in the early of 2010, development of this model grew rapidly. As Chinese government’s suppression of the real estate industry and some construction is completed, sales of dump truck began falling. Sale of dump truck was 46600 units in June, down 38.26% compared with the highest monthly sales in the first half of 2010. Frontal is suitable for all types of cargo transportation, and benefited from development of logistics industry, its market performed well in the first half of this year. Cumulative sale of frontal was 251,900 units, an increase of 29.76% year on year. Tank truck mainly includes concrete mixer truck, oil tanker and powder materials transport vehicle. Demand for tank truck was great after Spring Festival. Cumulative sale of tank truck was 54100 units in the first half of 2010, up 102.71% compared with the same period of last year.

　　Prospect of China’s auto industry in the second half of 2010

　　In general, performance of China's auto industry was satisfactory in the first half of 2010.During the second half of 2010, China's national economy is expected to keep high growth rate and purchasing power of Chinese consumers is supposed to ratchet up. The above favorable factors can be a good foundation for development of China's auto industry. Although favorable policies for Chinese car market will continue, its positive effect on pushing auto industry will diminish obviously. Subsidy for fuel-efficient and new energy vehicles is supposed to stimulate Chinese car market further. With the process of city continuously accelerating, rapid growth of second and third tier car market can also push growth of Chinese car market.

　　At the end of 2010, policies such as purchase tax reduction, car to the countryside and auto replacement are likely to exit, under such circumstance consumers will buy cars before the end of 2010, so we predict that growth of Chinese car market will slide slightly in the third quarter but it will rebound in the fourth quarter. (Translator: Qinghua Wade)

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　　http://auto.sohu.com/20100705/n273294164_3.shtml