General Motors on Tuesday reportedly said it sold 132,401 vehicles to dealerships in China in the first quarter, up 1.3% from the same period last year.
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The Associated Press (AP) said the figure included sales of 59,205 vehicles in March, up from 52,861 vehicles in March 2004, while GM said its market share in China also rose to 10.4% at the end of March from 9.3% at the end of last year.
AP noted that China was GM’s second-largest global market last year and has been a major source of profits in the past two years.
Auto sales in China slumped in the first two months of the year as banks tightened credit and dealerships tried to sell off inventory, Troy Clarke, president of GM Asia-Pacific, said on Tuesday, according to the report.
However sales rebounded to a record level in March, AP said, citing the China Association of Automobile Manufacturers – in a survey of 39 passenger car makers, the group found car sales rose 2.5% year-on-year in March to 256,000 units.
“In the first quarter the overall market has decreased about 3.7% year on year,” Chris Gubbey, executive vice president of Shanghai General Motors, told Associated Press, adding: “However, we expect those sales to pick up in the second half of this year as many of those who have been sitting on the fence will enter back into the buying game.”
AP said GM forecasts 10 to 15% annual growth in China’s auto market this year and 10% growth for a few years afterward.
However, GM’s profitability and margins could be slightly lower than in the past as competition heats up, Gubbey told AP.
Clark reportedly said GM is selling more mini-cars and vans and fewer Buicks – a trend that affects earnings because of the higher margins on Buicks.
“But this is not an unexpected shift and our operations are profitable, and in fact exceeding our forecast of where we would be at this point in time,” he told the Associated Press, though he would not give any figures.
