China pips US as the world’s largest auto market, the year Detroit was ‘bombed’

China surpassed the United States as the world’s largest auto market, after its 2009 vehicle sales jumped 46 per cent, ending more than a century of American dominance. As China celebrates the milestones and before we actually delve deep in statistics, here’s a curtain raiser to the Detroit Auto Show. Bankruptcies, mounting jobs losses, increasing endangered fleet of brands and a new wave of executives taking control, all set in the background of a global recession losing steam, will mark the opening of the show this morning at the Cobo Center, Detroit, Michigan.
Largely attributed to Beijing’s policy to spur the use of clean and fuel-efficient cars; the sales of passenger cars, buses and trucks in China rose to 13.6 million - the fastest pace in at least 10 years, according to the China Association of Automobile Manufacturers. In the US, sales slumped 21 per cent to 10.4 million, the fewest since 1982, according to Autodata Corp.
As far as China is concerned, it has made great strides in 2009 – the year in which the Dragon Economy celebrated six decades of Communist Party rule. The past year also saw Chinese automakers venturing on to the global stage for the first time in a major way, ready to snap up big-name brands, such as Volvo and Hummer. Geely Holding Group is now the owner of Ford’s Volvo car unit, following Beijing Automotive Industry Holding Co’s purchase of some Saab platforms in December.
US and European auto makers have found green pastures in China in the recent years as it has helped automakers including General Motors Co. and Volkswagen AG compensate for slumping demand in the US and Europe. GM, the biggest overseas automaker in China, said on January 4 that its Chinese sales rose 67 per cent last year to a record 1.83 million vehicles. Ford Motor Co., the lone auto survivor that didn’t ask for government support, is spending $490 million on a third plant in China, while Volkswagen plans to invest 4 billion euros ($5.7 billion) in the country by 2011.
The Chinese government announced in January last year that it would halve the purchase tax to 5 percent on vehicles with a displacement of less than 1.6 liters. Rural consumers got up to 5,000 yuan (735 US dollars) in government subsidies for vehicles with a displacement under 1.3 liters.