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Auto production, sales to hit 10m units in 2008

Auto production and sales in China are both likely to hit a record 10 million units this year, an industry executive forecast on Tuesday.

Dong Yang, vice chairman of the China Association of Automobile Manufacturers (CAAM), told Xinhua it was a "foregone conclusion" that both China's auto output and sales would surpass 8.7 million units in 2007.

"They will continue to expand at double-digit rates in 2008," he added.

In 2006, China overtook Japan to become the world's second largest car market, trailing only the United States, with sales of 7.2 million units, up 25.13 percent from a year earlier. The country was also the world's third largest vehicle producer, after Japan and the United States.

Currently, vehicle ownership in China was 44 for every 1,000 people. This was compared with the world average of 120. The United States had 750 vehicles for every 1,000 people.

Dong said the domestic car market had huge potential as the country had 57 million motor vehicles by the end of last year. Among them were 21.5 million privately-owned cars, according to latest government figures.

"Motor vehicles will play an extraordinarily-important role in China's consumer spending," he said, as the economy maintained fast growth and the government tried to encourage people to spend money.

Total auto sales in China jumped to 7.95 million units in the first 11 months of 2007, up 23.2 percent from a year ago, according to CAAM data.

Vehicle sales in November alone rose 16.3 percent in comparison to the same period a year earlier to 800,900 units.