China auto production, sales climb 20 percent

updated 4:56 p.m. ET Jan. 13, 2008

BEIJING - Chinese automobile production and sales climbed more than 20 percent last year, state media reported Sunday, showing continued robust growth in the world's second-largest auto market.

Production totaled 8.88 million vehicles in 2007, up 22 percent from the year before, the official Xinhua News Agency reported, citing the China Association of Automobile Manufacturers. Sales rose 21.8 percent to 8.79 million units, the report said.

Passenger sedans, not including sport utility vehicles and minivans, accounted for about 53.8 percent of total sales, the report said.

China cruised past Japan in 2006 to snatch the title of the world's No. 2 auto market, with total sales of 7.2 million vehicles — including trucks and buses — and production of 7.3 million.

China's domestic passenger car sales continue to be dominated by foreign automakers, with market leader Volkswagen AG of Germany saying it sold 910,491 VW, Audi and Skoda brand cars in China last year, up 28 percent from 2006.

Volkswagen said its sales figures brought its total share of the market in China, including Hong Kong, to 18 percent.

The company has two joint ventures in China — one with the state-owned China FAW Group, or FAW-Volkswagen Automobile Co., and one with SAIC Motor Corp., or Shanghai Volkswagen Automotive Co.

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General Motors Corp., through its passenger car joint venture, Shanghai General Motors Corp., sold 479,427 vehicles in China in 2007, up 16.9 percent, the company said.

Chinese automakers such as Chery Automobile Co., Geely Group, and FAW Group Corp. have struggled to establish themselves against their better equipped foreign rivals and have begun turning to export markets for increased sales.

China exported 413,500 complete finished vehicles — including cars, buses and trucks — in the first 10 months of last year, up 64 percent over the same period of 2006, according to Commerce Ministry figures. The bulk of Chinese auto exports go to developing nations such as Russia, Iran and Kazakhstan.

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