Fierce price wars and new models have been the features in China's booming automotive industry in recent years. Analysts and major players predict that prices will continue to drop and more models will be launched this year.

Automotive resources Asia Ltd predicted that at least 40 new models will be launched in China this year, a rise from 36 new models that were introduced in the world's fastest-growing car market last year.

Yale zhang, an analyst from Automotive Resources Asia, said that one feature of China's auto industry was that it boomed in a much shorter period than that in the West.

Zhang said that there were more than 90 models in the Chinese mainland market by the end of last year. This figure did not include upgraded models.

"Therefore, because of keen competition, some models may disappear more quickly than the common life cycle in the industry worldwide," said Zhang. "More of that happening may occur in a few years."

In January, Beijing Jeep Corp, China's leading off-road automotive maker, unveiled its Mitsubishi Outlander. Shenyang Brilliance Jinbei's Zhonghua 2.4-liter automatic transmission version and Tianjin Toyota's Corolla are expected to be launched this month.

The china Association of Automobile Manufacturers forecasts that China will produce 5.1 to 5.34 million vehicles this year, including 2.5 to 2.62 million cars. It also said that China manufactured more than 4.44 million vehicles last year, a 35.2 percent rise year-on-year.

More than 2.01 million sedans were made last year, an 84.4 percent rise from a year earlier, and 1.97 million cars were sold in China last year, an 80.4 percent increase year-on-year.

"China's car sales will increase 28 percent to 2.5 million units from 1.96 million last year," Xiao Guopu, vice president of Shanghai Automotive Industry Corp, forecast last month.

Saic is China's biggest car seller, having sold 597,000 vehicles last year through its joint ventures with Volkswagen AG and General Motors Corp. It expected sales to reach 740,000 units this year and total sales, including mini-vans and other vehicles, to rise 1.6 percent to nearly 190 billion yuan (US$23 billion), from 187 billion yuan.

The state Council's research department said that the domestic automotive market may develop more slowly this year, while the strong demand in China may be sustainable for 20 years or longer.

It predicted that private cars, seen to reach 70 million units by 2020, will be the main engine to drive the automotive industry in China.

(Eastday.com February 2, 2004)