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Auto industry expected to grow faster in H2

Xinhua, July 17, 2011

The government has introduced a slew of measures recently that are aimed to help small and middle-sized enterprises (SMEs) get finance.

"It's good news for the intermediate and senior passenger vehicle market because a considerable share of its targeted consumers are SME owners," Yu said.

Further, the government announced in June it would introduce measures to lower transportation costs by reducing relevant taxes and road tolls, Yu noted.

Meanwhile, the car purchase limit implemented in Beijing, which has led to shrinking sales in the local market, was unlikely to be adopted in any large scale way in other regions, according to the CAAM.

Jiang Jun, professor with Jilin Academy of Social Sciences, shared the view, saying that any intent to institute a similar policy in other parts of the country was unlikely to get approval.

Beijing launched a car-quota system on Jan. 1, limiting only 240,000 new cars to be registered in the city this year, compared with the 800,000 new automobiles that took to the streets in 2010.

According to Yu, the rising consumer prices, which are discouraging people from spending generally, will start to decline later this year as the country's tightening measures gradually take effect.

"Consumers will become more confident once the inflation is contained," said Yu, who expected the country's consumer price index (CPI), the main gauge of inflation, to peak during June and July.