In Communist China, People Buy Ten Million Cars
OK, OK, enough with the Yakov Smirnov references. China is no more communist than, say, California. And its vehicle sales prove it. With already-strong demand for passenger vehicles growing by 15 percent this year, Xinhua reports that Chinese automakers are set to sell 10m cars during 2008. According to information from the China Association of Automobile Manufacturers (CAAM), the demand is partly a product of falling car prices; a trend under threat from high steel costs. Moreover, as its car market matures, the Chinese government is poised to “move forward the industry restructuring by detailing standards on security, environment protection and energy saving,” according to CAAM vice-chair Dong Yang. “We should keep a clear mind of the overall industry competence lagged behind that of the multi-national companies.” Bringing domestically-produced Chinese cars up to international snuff will doubtless prove difficult. As the Chinese market matures and regulatory barriers to ownership increase, sales growth should level off. At some point, the People will bias the market towards home-grown products. Until then, it’s double-digit growth as usual.