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Global auto makers rev up in China

By Li Fangfang (China Daily)
Updated: 2009-04-21 08:02

SHANGHAI: The economic crisis and sagging sales have not dampened global car makers enthusiasm on China, the lone market that bucked the global trend last year, if one were to judge the response to the biennial Shanghai International Automobile Industry Exhibition which opened yesterday.

"The Shanghai automobile show has become the largest show for Mercedes-Benz globally, and is comparable only to the Frankfurt Motor Show," said Klaus Maier, president and CEO of Mercedes-Benz (China) Ltd.

Maier's optimism is ably backed up by the year-on-year sales growth of more than 30 percent in China during the first quarter.

Dieter Zetsche, chairman of Daimler AG and head of Mercedes-Benz, said he expected China, its fifth biggest market, after the US, Germany, United Kingdom and Italy, to vault itself to the second slot "soon".

"China is our key focus right now," said Eugenio Razelli, president and CEO of Magneti Marelli, an auto components maker under Italy's Fiat Group and major partner for the Formula One race.

He told China Daily that the Shanghai auto show is the only international automobile show that the company participates in. "We even canceled the plan of going to Frankfurt auto show which is a big gathering of auto parts suppliers in Europe."

Despite the gloom that prevailed at the Detroit auto show in January, the bustling exhibition in China's financial hub has been able to attract more than 1,500 automobile and parts maker from 25 countries and regions, with 13 models slated for their global debuts.

"China remains the centerpiece of General Motors' global growth strategy," said Nick Reilly, General Motors' Asia-Pacific president. "China is not so affected by the financial crisis. The strong economy and increasing demand indicates the growing potential of the market."

China has been the lifeline for the ailing US auto giant, which is grappling with bankruptcy. "We will continue to invest in new products, facilities and technology in the China market," said Reilly.

Even with an unclear future, the world's largest automaker set an ambitious target earlier this month, to double its annual sales in China over the next five years.

Its major rival Volkswagen is also planning to double its sales by 2018, by adding four new models to its lineup each year in China.

"I take the Chinese market as our second home market. My estimation is that Volkswagen's sales in China will overtake that of Germany's this year," said Martin Winterkorn, CEO of Volkswagen AG.

The German carmaker has achieved monthly sales of 112,466 cars in China in March, breaching for the first time the 100,000-unit mark for single month sales.

"Our sales in April is likely to surpass the March figures," said Winfried Vahland, president and CEO of Volkswagen Group China.

Mercedes-Benz's Zetsche estimates that the luxury car segment growth will double from the 6 percent growth rate of China's overall auto market this year. "And we hope to run faster than the whole segment," he said.

(China Daily 04/21/2009 page14)