Sales of domestically made automobiles this year are forecast to reach 3 million units by the end of the year based on robust growth during the first five months.

Jia Xinguang, chief analyst from the China Automotive Industry Consulting and Development Corp, said sales this year are expected to rise to 3 million from 2.36 million units last year "as long as the strong growth momentum can be maintained."

According to statistics released Sunday by the China Association of Automobile Manufacturers (CAAM), automakers in China sold 1.28 million units during the first five months of this year, an increase of 27.03 percent from a year earlier.

"Sales will continue to increase rapidly during the remainder of this year thanks to new product launches and manufacturers' price cuts driven by China's tariff decreases since its entry into the World Trade Organization (WTO)," Jia said.

Statistics show sales in May alone increased by 46.09 percent year-on-year to 294,000 units.

But May sales declined by 13.41 percent compared with April of this year, said Zhu Yiping, an official of CAAM.

Zhu attributed the decline largely to the week-long Labor Day holiday.

"Sales growth during the June-August period this year will remain slow because these months are not a booming season for the vehicle market according to the experience over the past 10 years," Jia said.

However, sales will recover and grow quickly in September, he predicted.

Qie Xiaogang, an official from the Beijing Asian Games Village Automobile Exchange, made a more optimistic forecast for total sales this year.

"Total sales will exceed 3.1 million units this year in line with the current market development," Qie said.

During the first five months this year, 4,476 vehicles were sold at Qie's exchange, one of the largest in Beijing.

"You could see consumers' fever during the Beijing auto show, and many of them will buy cars soon," he said.

The Seventh Beijing International Auto Show, which ended last Thursday, attracted 410,000 visitors. During the eight-day event, automakers received orders for nearly 10,000 vehicles.

Shanghai GM, a joint venture between Shanghai Automotive Industry Corp and the world's No 1 automaker General Motors, said it received orders for more than 1,100 Buick sedans during the auto show.

Local automakers also launched a slew of new products during the auto show, including the Elysee of Dongfeng Citroen Automobile Co, the 1.6-litre Bora of First Automotive Works' Volkswagen, and the Sunroof Buick Sail of Shanghai GM.

According to CAAM, sales of passenger cars during the first five months of this year reached 375,500 units, up 33.14 percent from the same period last year.

In May, passenger car sales increased by 43.58 percent year-on-year to 80,900 units.

Automakers in China produced 1.29 million units from January to May this year, an increase of 30.37 percent from a year earlier.

At the beginning of this year, China cut its tariffs on auto imports from 70-80 percent to 43.8-50.7 percent.

Under WTO obligations, the tariffs will be reduced to 25 percent by mid-2006.

(China Daily June 17, 2002)