Changan Auto, Ford’s main Chinese partner, reportedly posted a 7.3% fall in second-quarter earnings on Tuesday, as car sales in China took a hit from government measures to slow a booming economy.

Chongqing Changan Automobile, which also makes compact cars with Suzuki, said net profit in the first half rose just 4.4% on year to 798.72 million yuan ($US96.51 million), according to Reuters.

Calculating from previously available figures, that meant earnings in the April to June quarter came in at 407.13 million yuan, less than the 439.25 million yuan figure unveiled in the year-ago period, the report added.

The automaker reportedly attributed the rise in first-half net earnings to its venture with Ford, in the inland manufacturing city of Chongqing, which is bumping up output to 200,000 units a year by 2005 after selling just 17,000 cars in 2003, its first year of operations.

China’s largest minivan-maker saw total sales in the first half rise 27.5% to 248,810 vehicles, boosting turnover by 39.7% to 10.14 billion yuan, Reuters said.

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But in the second quarter, revenue dropped 30% to 5.38 billion yuan, blamed on a vicious price war, though it reportedly added the situation was not all bleak.

“Even though the increase rate of the whole auto industry fell, that for mini-cars and vans was higher than last year,” it added in a statement cited by Reuters.

Changan Auto’s quarterly report gave no forecast for full-year performance, but officials told Reuters in March Changan Auto expected its sales to jump 22% in 2004.

Analysts reportedly have also forecast a rise of about 20% in Changan Auto’s earnings this year, although that would be slower than a 73.7% surge in 2003 when net profit reached 1.45 billion yuan.