Volkswagen AG continued to sell the most cars in China in the first half of 2003 with a 38% share of the booming market thanks to its two local joint ventures, Reuters said on Monday, citing the official Xinhua news agency.
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According to Reuters, Xinhua quoted the China Association of Automobile Manufacturers as saying that Shanghai Volkswagen Automotive Co Ltd produced 202,578 passenger cars in the first six months and sold 192,193 of them, making it China’s top car maker.
FAW-Volkswagen Automotive Co Ltd, VW’s venture with China’s First Auto Works in the northeastern city of Changchun, manufactured 147,001 cars and sold 130,291 in the same period, Xinhua said, according to Reuters, which added that the two ventures grabbed 22.8% and 15.4% market share in China, respectively.
A total of 842,800 cars were sold in the first half, up 82% from a year earlier, Reuters said, citing Xinhua, and sales broke the million mark in China for the first time only last year.
Output roared up 83% to 903,400 over the same period, the State Statistical Bureau said last month, exceeding car sales, Reuters noted, adding that foreign car makers have announced plans to more than double production over the next four years, raising fears of a margin-sapping glut, but they hope economic growth of 8% a year will soak up additional output.
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By GlobalDataOne analyst warned against pumping up output too fast, Reuters said.
“It’s a very dangerous game — demand is not catching up with supply,” Xu Xiang at China Southern Securities told Reuters.
“Too many products are overlapping and expansion is happening too fast. This will inevitably lead to more price wars and a slide in margins,” Xu reportedly added.
According to Reuters, Xinhua made no mention of possible overcapacity problems and said the third-largest player was Tianjin FAW Xiali Automotive Co Ltd, which has a strategic partnership with Toyota, and sold 74,707 cars and produced 84,328 in the first half.
Reuters said Xinhua reported Guangzhou Honda Automotive taking seventh place, selling 48,424 cars, just one shy of its total output in the first six months of the year.
Number 10 position was taken by Beijing Hyundai, a joint venture between Hyundai Motor and Beijing Automotive Industry Holdings, which sold more than 20,000 units in the first half, Xinhua said, according to Reuters.
