Domestic demand to drive China's auto market forward

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China's auto market will continue to drive forward as firm domestic demand is set to continue over the coming years, with car makers also investing more in new energy vehicles and becoming more environment conscious.

While the global automotive industry is struggling to recover from a glut after the economic crisis, the vast market potential and business opportunities in China have helped the 14th Shanghai International Automobile Industry Exhibition to bask in the spotlight compared to auto shows in Detroit and Geneva earlier this year.

Su Bo, vice minister of industry and information technology, estimated China's vehicle sales to rise from last year's 18 million to 23 million units by 2015, based on the slowest annual growth scenario of 5 percent.

Speaking at a forum ahead of the Shanghai auto show yesterday, Su said the auto market is, however, not likely to repeat the explosive growth seen in the past during which the domestic industry ignored innovation and the development of China's own brands.

"The fundamentals and positive long-term prospects of our auto industry haven't changed," Su said. "However, while we are fast expanding the scale, competition in product quality is getting more intense. It's imperative for the auto industry to boost innovation capacity, transform growth model and upgrade technology."

The show, with its theme of "Innovation for Tomorrow," will see a record 86 new energy-efficient cars on display.

With increased attention trained on China, the world's largest auto market, car makers have quickened their product launches and unveiled aggressive strategies to propel their ambitions even before Auto Shanghai 2011 opens a two-day media preview today.

Shanghai Volkswagen introduced its new Passat mid-to-high range sedan, which is tailor-made for the Chinese and United States markets. The model will compete with Toyota's Camry and Honda's Accord.

Volkswagen also debuted the world premiere of its new Beetle yesterday and Guangzhou Honda expanded into the rapidly-growing compact MPV market with its EV Yizhi.

General Motors intends to introduce more than 60 new or upgraded models and aims to double sales to around 5 million units under its five-year plan to 2015, unveiled yesterday, for the Chinese market.

Ford plans to aggressively introduce its electric vehicles in China for the first time as it launched the Asian debut of three green models yesterday, including the Focus Electric car. The US car maker aims to unveil over 15 models in China over the next four years.

Joe Hinrichs, president of Asia Pacific and Africa at Ford, said the car maker estimated growth of China's auto market to slow to 5-10 percent this year. He said the slower figure is still growth and "very sustainable for the industry."

Auto Shanghai 2011 will be held at Shanghai New International Expo Center from Thursday to April 28.

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