Car sales growth in Chinese market is likely to dip steeply to 3-5% in year 2012

Monday 21 November 2011, 11:31 AM by Vikas Yogi

With a considerable slowdown in the sales of cars in the global market, more and more car makers are decreasing their sales forecasts for the year 2012. The Chinese market, which is the fastest growing car market in the Asian market, is expected to grow at quite a slower rate as compared to heavy double digit growth of 33 percent registered last year. The sales growth in the Chinese market is expected to stand at 3 to 5% in year 2012.

The sales growth registered in the Chinese market in Q4 is quite low compared to the growth registered in the same period last year. In October 2011, the car sales growth in China stood at mere 1.4%, raising concerns of major car makers in the country.

The state owned Chongqing Changan Automobile Co, which is a major car maker in the Chinese market, has said that the Chinese auto market may register a record slow growth next year. In a recent statement, Chongqing Changan Automobile Co President Zhang Baolin said, "The first quarter next year may be similar to the fourth quarter this year. China's car market next year is likely to remain in a slow growing trend overall. Next year will be slightly higher. I expect sales will rise 3 to 5 percent."

The Chongqing Changan Automobile Co will soon be partnering with French auto major PSA Peugeot Citron. The tie-up will be on 50:50 basis, in which total investment from these two auto giants will be 8.4 billion Yuan ($1.3 billion).

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