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Thread: China Auto News and Related Discussions.

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    China Auto News and Related Discussions.

    Instead of trying thread-hijack the Chevy Volt thread, I'll try to create a separate thread here. BYD Auto has the potential to be the first significant Chinese technology company, in that their technology is highly-regarded and used around the world. Haier's specialty is converting niche-markets to mass markets with their cost advantage, and Lenovo's ruined the Thinkpad, check the build on the T61.

    BYD started out as a battery maker and continues to control around 33% of the Li-on battery market. Their founder got it into his head to get into the electric car business, and they bought out defunct Chinese automakers. Starting with Toyota knockoffs, they eventually migrated over into Toyota knockoffs with electric batteries. Their present technology uses a relatively unique Li-on Iron Phosphate technology, which is safer than conventional Li-on batteries, but has lower energy capacity. The Chevy Volt's rejected the Iron Phosphate technology from A123 and opted for more dangerous and higher-capacity batteries, expecting to work out the safety issues between now and 2010.

    Currently, the hybrid electrics BYD Auto is producing is limited to the F3DM. It's a small car, but it's the only mass-market plug-in electric on the market. BYD Auto is also supposed to come out with a F6DM model, a larger version of the F3DM, but I haven't heard a word about it in the English-language press for a while. BYD is also planning to produce a pure electric called the E6.

    I'm just curious, if anyone has any information on these topics, could you please post them here on the thread? Right now, I'm interested in reviews for the F3DM; while the technology is groundbreaking, I don't think any Western reviewers have been able to evaluate it, its safety features, and its vehicle performance (supposedly 12 seconds from 0 to 60). I'm also interested in international expansion plans, which I'm told consist of introducing the larger F6DM to international markets, the progress of the E6 pure electric sedan, and BYD's future battery technologies. I don't think I've mentioned this yet, but BYD's vehicles deep-cycle their batteries, severely impacting their lifespan. It means that BYD's vehicles get 150% the range of the promised Chevy Volt, but it also means that the batteries have to be replaced around 6 years into their lifespan, assuming daily use. This may seem like an unacceptable proposition for the average consumer, but first, in its home market, the average usage life of vehicles is 5 years. It's not bad. Second, electric vehicles are a growth field. ICEs have been around for ages and new improvements to the technology are slow and laborous. Since electric vehicles are an untapped field, improvements to the technology will come faster, and consumers will be less outraged at upgrading their batteries than they would be at replacing their batteries.

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    My problem is the battery, not only they are extremely toxic and there is no way they last 6 years. Given the environmental record of China, it scares me.

    batteries have to be replaced around 6 years into their lifespan

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    Excuse me, how is lithium iron phosphate toxic? Part of the marketing brochure for the lithium iron phosphate technology is that it's non-toxic.

    Here, this article from treehugger...

    http://www.treehugger.com/files/2008...ctric-cars.php

    Cheaper and more Powerful Batteries for Hybrids and Electric Cars
    Scientific progress often moves in a seesaw pattern. You have a technology, you then discover a new one that is better in some aspects, and worse in others. Then you find out how to mitigate the downsides of that second technology, finally supplanting the first one, and so on.

    Iron vs. Cobalt
    It seems to be what is happening with lithium iron phosphate batteries. They have many benefits over the lithium cobalt oxide used in current li-ion batteries; iron costs much less than cobalt, they can deliver large bursts of power (useful in hybrids and electric cars), and they are safer (they are used in the One Laptop Per Child project, for example).

    But, it's not all rainbows and puppies. The manufacturing process of iron phosphate batteries is complex and expensive, requiring hours and temperatures as high as 700 °C. That's where the breakthrough comes in...



    Reducing Manufacturing Costs of Lithium Iron Phosphate Batteries
    Arumugam Manthiram, a professor of materials engineering at the University of Texas at Austin, has shown that a new technique that uses microwaves can reduce both the amount of time it takes, and the temperatures required to make li-iron phosphate batteries.
    Manthiram's method involves mixing commercially available chemicals--lithium hydroxide, iron acetate, and phosphoric acid--in a solvent, and then subjecting this mixture to microwaves for five minutes, which heats the chemicals to about 300 °C. The process forms rod-shaped particles [see image above] of lithium iron phosphate. The highest-performing particles are about 100 nanometers long and 25 nanometers wide. The small size is needed to allow lithium ions to move quickly in and out of the particles during charging and discharging of the battery.

    It's still too early to tell how this will impact battery production, but it certainly is very promising.

    Plug-in Hybrids and Electric Cars that will use Iron Phosphate Batteries
    We already know that Chinese automaker BYD will use lithium iron phosphate batteries in its F6DM and F3DM plug-in hybrids, and in its E6 electric car. A123 Systems is also working on them, as well as GM.
    Wondering how much is known about BYD's technology, and whether they already came up with this innovation.
    Last edited by Inst; 23 Dec 08, at 20:53.

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    Most lithium systems contain electrolyte which is toxic

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    I looked it up and apparently the electrolyte is toxic on the level of automotive antifreeze.

    I can dispute the lifespan, however, BYD claims that it can survive 100,000 km of use with 80% lifespan. GM, which is more trustworthy, claims that its battery is good for 100,000 mi of use.
    Last edited by Inst; 23 Dec 08, at 22:15.

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    Well, my reaction now is that "I can't believe they hoodwinked Warren Buffet".

    http://www.nytimes.com/2009/01/13/bu...l?ref=business

    A Small Showing, but With Big Dreams
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    By NICK BUNKLEY
    Published: January 12, 2009

    Enlarge This Image

    Fred R. Conrad/The New York Times

    Wang Chuanfu, BYD chairman, says that when his company sets a goal, “we’re going to make it.”
    Times Topics
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    DETROIT — For the first time, two Chinese carmakers are exhibiting this year on the main floor of the Detroit auto show, a promotion of sorts from the usual spot they were given for previous shows in the convention hall’s basement or lobby.

    One of those carmakers, BYD, a Chinese manufacturer that produces many of the world’s cellphone batteries and only began selling cars in 2003, also upgraded its ambitions, saying it would be the world’s largest automaker by 2025.

    Few people here are willing to dismiss its goals as absurd.

    “They are very competent in the battery business,” Nick Reilly, president of the General Motors Asia-Pacific region, said of BYD. “I think they’ve got a fair way to go on the car side of the business. But they are certainly not to be ignored. They have a great deal of support from the Chinese government.”

    Brilliance Auto, which has relationships with BMW and Porsche, is the other Chinese carmaker on the main floor.

    BYD, which stands for Build Your Dreams said that by 2011, it planned to begin selling in the United States an electric crossover vehicle with a 250-mile range and a plug-in hybrid vehicle. It started selling a smaller version of the plug-in hybrid in China last month, almost two years before the Chevrolet Volt is scheduled to go on sale, and a year before Toyota says it will introduce a plug-in vehicle.

    “We think it’s quite practical and can do well in this market,” the chairman of BYD, Wang Chuanfu, said in an interview. “We are a company that, when we set a target, we’re going to make it.”

    Analysts are not so sure that BYD or any other Chinese manufacturer is that close to arriving in the United States. Similar promises by companies like ZX Auto, which vowed during last year’s Detroit show that its vehicles would arrive stateside by the end of 2008, have fallen short.

    Mr. Wang said BYD was studying how to establish a dealership network, which analysts said could take longer than expected.

    “They underestimate how much it’s going to take to break into the market,” said David Champion, director of auto testing for Consumer Reports. But Mr. Champion called some of the vehicles, “very impressive.”

    Brian Johnson, an analyst with Barclays Capital, expressed skepticism about the companies’ lofty claims, though a recent investment in BYD by Warren E. Buffett’s holding company, Berkshire Hathaway, has considerably increased its credibility.

    “They’re making five-year leaps every year,” Mr. Johnson said. “But the interiors and styling still need work.”

    Executives from Brilliance said they planned to export vehicles to North America, Europe and Russia but gave no time frame for entering the United States. For now, Brilliance is gauging reaction to its cars and learning about the market.

    The Detroit show “is an excellent platform to measure ourselves against international standards,” said He Guohua, a Brilliance vice president.

    The company, which said it has 35,000 employees and $4.5 billion in assets, is showing four cars in Detroit, including a sports car and a luxury sedan.

    “They are all really nicely done,” Mr. Champion said.

    Bill Vlasic contributed reporting.

    If anyone can point me to some Chinese language reportage, I'd be in your debt.

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    China monthly auto sales overtake US for 1st time

    February 10, 2009
    By DAN STRUMPF and ELAINE KURTENBACH

    Monthly auto sales in China surpassed those in the U.S. for the first time last month, but automakers and industry watchers say the news may tell us more about the troubles in the U.S. than about China's growing car market.

    "China has the potential very easily to become the largest car market in the world," said Tom Wilkinson, a spokesman for General Motors Corp., but "it was probably a bit of an aberration in January."

    Data released Tuesday by the China Association of Automobile Manufacturers shows 735,000 new cars were sold in China last month, down 14.4 percent from the record of 860,000 set in January 2008. U.S. sales, meanwhile, fell 37 percent to 656,976 vehicles -- a 26-year low.
    It's another indication of China's economic clout, but it may take a while before China becomes the world's largest auto market.

    "Right now, with the U.S. in correction mode, we're going to get these kinds of anomalies," said Rebecca Lindland, auto analyst for IHS Global Insight. "We could get them throughout the course of this year and throughout next year if we don't get an economic recovery."

    U.S. auto sales have shrunk from an annual sales rate of around 16 million to sales of 13.2 million vehicles in 2008. Analysts and automakers are predicting industrywide sales to drop as low as 10.5 million this year as high unemployment and low consumer confidence keep people from purchasing big-ticket items.

    Chinese vehicle sales also have cooled, but hardly as dramatically. In 2008, China's auto sales grew 6.7 percent to 9.38 million units -- the first time growth has fallen below 10 percent since 1999.

    If American car demand revives in coming months, the U.S. likely will remain ahead in annual sales -- at least for another year. IHS Global Insight still predicts 2009 sales in China of between 9 million and 9.5 million, and U.S. sales of 10.5 million.

    China's vehicle market has grown dramatically in recent years, overtaking Japan in 2006 to become the world's second-largest by annual sales. With 1.3 billion people, China may inevitably leapfrog the U.S., with a population of 300 million, into the No. 1 spot, but that moment may still be many years away, Lindland said.

    "Even long term, I think the economics have a long way to go before China consistently passes us," Lindland said.

    China's best-selling automakers are GM and Germany's Volkswagen AG, but its own ambitious producers, such as Chery Automobile Co., are growing fast.

    GM said it sold a record 1.09 million vehicles in China last year, up 6 percent from 2007. With its growing middle class and vast potential as a consumer market, China is vital for GM, Volkswagen and Toyota Motor Corp. as they count on demand there to offset weakness in the U.S. and elsewhere.

    "There's no question that it's a huge potential market if you look at the number of people there, and as more people start to enter the middle class," GM's Wilkinson said. "A car is something a lot of people aspire to."
    GM is already is one of biggest automakers in China, with billions of dollars invested in joint ventures. The Detroit automaker has been counting on the growth in China and other emerging markets to help offset losses elsewhere. It currently sells cars under nearly all GM brands and through a joint venture called SAIC-GM-Wuling.

    Wuling sales accounted for more than half of GM cars sold in China last year, spokesman John McDonald said, with a huge portion coming from the popular Sunshine minivan.

    To spur the slowing auto market, the Chinese government has rolled out measures to help boost vehicle sales as part of a multibillion-dollar economic stimulus package while it also tries to promote cleaner, more energy-efficient engines.

    The sales tax on cars with engines less than 1.6 liters has been cut by half to 5 percent through the end of the year. The government also is spending 5 billion yuan (about $730 million) on subsidies to farmers to replace three-wheeled vehicles or outdated trucks with small, 1.3-liter-or-less vehicles.

    Another 10 billion yuan ($1.5 billion) is going into upgrading automakers' technology and developing alternative energy vehicles.

    Trucks and buses make up a larger share of China's sales than those of the United States or Japan. Some observers say that makes direct comparisons misleading. But many rural Chinese use such commercial vehicles for everyday family use.

    Elaine Kurtenbach reported from Shanghai.
    http://www.businessweek.com/ap/finan.../D96906LG0.htm

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    Beijing --- a city on automobiles

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    China Car Sales Jump ‘Beyond Imagination,’ Bring Wait (Update1)
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    By Bloomberg News

    June 10 (Bloomberg) -- Zhao Hang, who helped devise China’s auto-stimulus package, is facing demand from car buyers battling an unexpected consequence -- two-month waiting lists.

    “Eight friends have asked me to make calls or write notes to contacts to help speed purchases,” Zhao, president of the government-linked China Automotive Technology & Research Center said in an interview. “Given the world economic situation, demand for cars is surprisingly strong in China.”

    Beijing drivers, used to leaving showrooms with new cars the same day, now have to wait about three weeks for a Hyundai Motor Co. Yuedong Elantra, China’s bestselling car, or as long as eight weeks for a Honda Motor Co. CR-V sport-utility vehicle. Carmakers failed to predict a 14 percent sales jump caused by an economic rebound, tax cuts and subsidies and are now trying to raise Chinese output even as they cut U.S. and European production on plunging sales.

    “We are having headaches and shortages because the automaker can’t make enough Yuedongs,” said Li Minghui, a salesman at dealership Beijing Hyundai Boshishan. “We expected sales to pick up at the beginning of this year, but it’s beyond our imagination that it would be this good.”

    The China Association of Automobile Manufacturers in January forecast a 5 percent increase in 2009 auto sales after demand declined in four of the last five months of 2008 amid the global recession. That would have been the slowest pace in 11 years. General Motors Corp, the largest overseas automaker in China, made a similar prediction.

    Sales Surge

    Instead, auto sales have surged after the government offered subsidies to drivers in rural areas and cut retail taxes as part of a wider 4 trillion yuan ($585 billion) economic stimulus plan. The demand jump has caused GM to double its 2009 industrywide growth forecast. Combined with a 37 percent slump in U.S. auto sales because of the recession, the surge has made China the world’s largest auto market so far this year.

    “Customers have to book in advance because there’s not enough stock of the bestselling cars,” said Guo Yong, information manager at Beijing Asia Games Village Automobile Exchange, which houses dealerships accounting for about 10 percent of Chinese car sales. “Fourth-quarter sales weren’t that good last year and most carmakers curbed production as they were pessimistic about sales this year.”

    Industrywide production trailed domestic and exports sales by about 300,000 vehicles in the six months ended May, according to the China Passenger Car Association. That’s helped push new vehicle stockpiles to near two-year lows.

    Production Increases

    To increase supplies of Yuedongs and other models, Beijing Hyundai Motor Co., Hyundai Motor Co.’s main China venture, ran plants at near-full capacity last month. Inventories had dropped to 80 percent of monthly sales, said President Noh Jae-man. Volkswagen has also added 50,000 vehicles to its 2009 production plan because of the demand jump.

    “The development of the passenger-car market in the first quarter exceeded our expectations,” said Winfried Vahland, Volkswagen’s China head.

    Honda’s two ventures in China have been running with three shifts because of demand for models including City cars and CR- Vs, the bestselling SUV in China. Still, the company hasn’t yet decided to expand capacity on concerns demand may not be sustainable, said Zhu Linjie, a Beijing-based Honda spokesman.

    The tax cuts and subsidies may have caused a short-term sales surge that will fade over the coming months, said Ricon Xia, a Daiwa Institute of Research (H.K.) analyst in Shanghai. Both stimulus measures are due to expire at the end of the year.

    “It is not yet clear how demand will go in the second half,” Xia said.

    In May, passenger-vehicle sales surged 47 percent from a year earlier, the most since February 2006.

    Parts Logjam

    The biggest logjam for Chinese automakers seeking to raise production is a shortage of parts, particularly more complex components, such as automatic gearboxes, generally imported from overseas. These are in short supply as plunging auto sales in the U.S., Europe and Japan, coupled with the collapse of GM, has forced partsmakers into bankruptcy.

    “Component-makers going out of business is causing headaches for carmakers in China,” said Qin Xuwen, a senior analyst at Orient Securities Co. in Shanghai. “It will take a couple of months to fix this.”

    To safeguard future supplies, Chinese companies are buying overseas partsmakers. BeijingWest Industries Co. in March agreed to acquire the remaining global suspension and brake businesses of Delphi Corp., the bankrupt former GM parts units. The same month, Geely Holding Group Co., China’s biggest private automaker, agreed to buy Drivetrain Systems International, an Australian gearbox-maker that was in receivership.

    Such deals may help boost Chinese vehicles supplies in the long run. For now though, drivers may have to continue waiting.

    “People are lining up for cars, and vehicles are going out of stock,” Zhao said. “Who could have expected that last year?”

    --Tian Ying in Beijing. Editors: Neil Denslow, Bret Okeson

    To contact the Bloomberg staff on this story: Tian Ying in Beijing on ytian@bloomberg.net

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    in fact BYD is not quite popular in chinese market, consumers here still prefer to buy traditional cars from international giants. hybrid electronic cars in china are a concept rather than a realistic choice, unlike prius from toyota. i think it will take a long way for chinese consumers to turn their interet from traditinal cars to hybrid cars, because there are so many people in china dreaming to have the experience of owning a car, no matter what kind it is.

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    I think small electric cars are great for China and India. Daily commute is short and mostly in congested urban areas. Most important of all is the "car culture" isn't as ingrained as that of American drivers. We like big, powerful, fast, and thirsty cars that can take us anywhere in the country without worrying about catching a flight or a train.
    "Only Nixon can go to China." -- Old Vulcan proverb.

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    Quote Originally Posted by Inst View Post
    Instead of trying thread-hijack the Chevy Volt thread, I'll try to create a separate thread here. BYD Auto has the potential to be the first significant Chinese technology company, in that their technology is highly-regarded and used around the world. Haier's specialty is converting niche-markets to mass markets with their cost advantage, and Lenovo's ruined the Thinkpad, check the build on the T61.

    BYD started out as a battery maker and continues to control around 33% of the Li-on battery market. Their founder got it into his head to get into the electric car business, and they bought out defunct Chinese automakers. Starting with Toyota knockoffs, they eventually migrated over into Toyota knockoffs with electric batteries. Their present technology uses a relatively unique Li-on Iron Phosphate technology, which is safer than conventional Li-on batteries, but has lower energy capacity. The Chevy Volt's rejected the Iron Phosphate technology from A123 and opted for more dangerous and higher-capacity batteries, expecting to work out the safety issues between now and 2010.

    Currently, the hybrid electrics BYD Auto is producing is limited to the F3DM. It's a small car, but it's the only mass-market plug-in electric on the market. BYD Auto is also supposed to come out with a F6DM model, a larger version of the F3DM, but I haven't heard a word about it in the English-language press for a while. BYD is also planning to produce a pure electric called the E6.

    I'm just curious, if anyone has any information on these topics, could you please post them here on the thread? Right now, I'm interested in reviews for the F3DM; while the technology is groundbreaking, I don't think any Western reviewers have been able to evaluate it, its safety features, and its vehicle performance (supposedly 12 seconds from 0 to 60). I'm also interested in international expansion plans, which I'm told consist of introducing the larger F6DM to international markets, the progress of the E6 pure electric sedan, and BYD's future battery technologies. I don't think I've mentioned this yet, but BYD's vehicles deep-cycle their batteries, severely impacting their lifespan. It means that BYD's vehicles get 150% the range of the promised Chevy Volt, but it also means that the batteries have to be replaced around 6 years into their lifespan, assuming daily use. This may seem like an unacceptable proposition for the average consumer, but first, in its home market, the average usage life of vehicles is 5 years. It's not bad. Second, electric vehicles are a growth field. ICEs have been around for ages and new improvements to the technology are slow and laborous. Since electric vehicles are an untapped field, improvements to the technology will come faster, and consumers will be less outraged at upgrading their batteries than they would be at replacing their batteries.

    Inst,

    check this out.






    Buffett reaps $1 bln profit on China carmaker BYD
    Fri Jul 31, 2009 11:37am EDT

    * BYD investment quintuples over 10 months

    * Buffett eyes international growth

    By Jonathan Stempel

    NEW YORK, July 31 (Reuters) - Warren Buffett's Berkshire Hathaway Inc (BRKa.N: Quote, Profile, Research, Stock Buzz) (BRKb.N: Quote, Profile, Research, Stock Buzz) has realized a $1.02 billion paper profit on a 10-month-old investment in BYD Co (1211.HK: Quote, Profile, Research, Stock Buzz) after shares in the Chinese car and battery maker quintupled.

    Berkshire's MidAmerican Energy Holdings Co unit had agreed last Sept. 26 to buy 225 million BYD shares at HK$8 each, a transaction then worth about $230 million.

    The China Securities Regulatory Commission on Thursday granted approval for the transaction, which gives Berkshire a 9.89 percent stake. BYD shares closed Friday at HK$42.90, valuing Berkshire's stake at HK$9.65 billion, or about $1.25 billion.

    Hong Kong's benchmark Hang Seng index .HSI is up 10 percent since Berkshire revealed the BYD investment.

    Berkshire agreed to the stake three days after deciding to buy $5 billion of Goldman Sachs Group Inc (GS.N: Quote, Profile, Research, Stock Buzz) preferred shares, despite the then-pervasive market turmoil after Lehman Brothers Holdings Inc's (LEHMQ.PK: Quote, Profile, Research, Stock Buzz) bankruptcy.

    Warrants attached to the Goldman investment have since generated a $2 billion paper profit for Berkshire.

    "Buffett has grown more comfortable investing in foreign companies in recent years," said Andy Kern, who writes the blog Berkshire Ruminations and is a doctoral candidate at the University of Missouri-Columbia.

    "Domestically, Buffett is taking advantage of Berkshire's solid capital position," he added, "while internationally, it's more that Buffett is simply finding bargains."

    Other non-U.S. investments by Berkshire include the reinsurer Swiss Re (RUKN.VX: Quote, Profile, Research, Stock Buzz) and the South Korean steelmaker Posco (005490.KS: Quote, Profile, Research, Stock Buzz).

    Earlier this decade, Berkshire made a few billion dollars on what had been a $488 million investment in Chinese oil company PetroChina Co (601857.SS: Quote, Profile, Research, Stock Buzz).

    Buffett is the world's second-richest person, after Microsoft Corp (MSFT.O: Quote, Profile, Research, Stock Buzz) co-founder and Berkshire director Bill Gates, according to Forbes magazine.

    Founded in Shenzhen in 1995 as a maker of rechargeable batteries, BYD expanded into mobile phones and automobiles.

    It expects to sell 400,000 vehicles this year, and targets the sale of as many as 9 million by 2025, according to Henry Li, general manager of BYD Auto's export arm. [ID:nHKG366761]

    BYD Auto launched its first plug-in hybrid vehicle, the F3 DM sedan, last December.

    Berkshire, based in Omaha, Nebraska, is a roughly $150 billion conglomerate that has close to 80 businesses selling such things as car insurance, ice cream and underwear, and which invests in dozens of companies.

    Analysts on average expect Berkshire on August 7 to report a decline in second-quarter operating profit. Net income and Berkshire's book value may grow if rising stock markets boost the value of Berkshire's derivatives contracts.

    Berkshire Class A shares were up $305 at $97,100 in morning trading on the New York Stock Exchange. (US$1 = HK$7.75) (Additional reporting by James Pomfret and Joanne Chiu in Shenzhen; Editing by Steve Orlofsky)

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    Chinese car market overtakes that of United States

    By ELAINE KURTENBACH and DEE-ANN DURBIN (AP) – 20 hours ago

    SHANGHAI — China has overtaken the U.S. as the world's biggest market for automobiles, the first time any other country has bought more vehicles than the nation that produced Henry Ford, the Cadillac and the minivan.

    Now that the Chinese buy more cars and trucks than Americans, the shift could produce ripples for the environment, gas prices and even the kinds of cars automakers design.

    More than 12.7 million cars and trucks will be sold in China this year, up 44 percent from the previous year and surpassing the 10.3 million forecast in the U.S., according to J.D. Power and Associates.

    China has long been expected to overtake the U.S. since its population of 1.3 billion is more than quadruple that of the United States. But the increase in sales happened much faster than anyone expected because of China's tax cuts, its stimulus program and a depressed American market.

    Two years ago, J.D. Power predicted China would pass the U.S. in 2025. Earlier this year, it forecast 2009 sales of just 9 million vehicles for China.

    After a sharp slowdown in auto sales late last year, the Chinese government cut taxes on small cars and spent $730 million on subsidies to encourage sales of SUVs, pickups and minivans. A big stimulus program also boosted truck sales by pumping money into construction.

    Auto sales were expected to rise with China's stimulus, but they have far exceeded expectations, said Jeff Schuster, J.D. Power's executive director of automotive forecasting.

    Most experts think the top-sales title will shift back and forth between China and the United States for the next several years, with China ultimately prevailing.

    Improving sales of autos and other big-ticket items is key to Beijing's strategy to promote stronger domestic consumption and lower dependence on exports.

    "The government has sent a very clear message that they will not let the auto industry weaken, especially in 2010," say Jia Xinguang, chief analyst at China National Automotive Industry Consulting & Developing Corp.

    Meanwhile, U.S. sales hit a 26-year low in early 2009 and remain well below the 17 million average from earlier this decade.

    China's growing auto market is sure to affect the industry worldwide. Some key factors are:

    _ CHINA'S CAR POLLUTION: It's gotten worse. China's fleet is newer, and big cities have imposed emissions standards that exceed those in the U.S., but lax enforcement of standards is a major problem. Vehicles may meet standards at first but then degrade over time.

    On top of that, the number of vehicles on China's roads is soaring, although it's still a fraction of the U.S.

    _ FUEL DEMAND: Global demand for oil is rising, fueled by China and India. Most energy experts agree that demand for crude has peaked in the U.S. Meanwhile, China's demand for oil used in transportation could more than double between 2007 and 2020, according to the World Energy Outlook, a joint study by the Organization for Economic Cooperation and Development and the International Energy Agency.

    At home, China struggles both with the amount and quality of its fuel supply. A study by Harvard researchers found that refiners were not supplying fuel that was good enough to meet the country's rising emissions standards.

    The cost of oil is prompting China to encourage a shift to cars and trucks that are more fuel efficient or run on batteries and alternative fuels. The government has raised taxes on gas guzzlers. China is the world's No. 3 net importer after the U.S. and Japan.

    _ VEHICLE DESIGN: The Chinese will have more influence over vehicle design as they buy more cars. GM had its Chinese team design the 2010 Buick LaCrosse because the brand sells better in China than in the U.S. Buick is considered a luxury car in China.

    The designers included sumptuous back seats for executives with drivers. They also used Feng shui principles and swooping designs based on Chinese art.

    Chinese automakers will emerge stronger from the sales boom. BYD Co. aims to overtake Toyota as the global auto leader by 2030. Among BYD's backers is billionaire investor Warren Buffett.

    China's sales may grow so large that cars designed for Chinese tastes are sold globally, the way U.S. vehicles are now. But some experts doubt that will happen until Chinese automakers become competitive on style and quality.

    Meanwhile, as China's middle class expands, Chinese car shoppers are developing tastes similar to those of drivers in the U.S. and other wealthy nations.

    "I talk to my friends in Beijing," says Crystal Jiang, a professor at Bryant University in Smithfield, R.I., who studies globalization. "I drive a Subaru, they also drive a Subaru."

    Durbin reported from Detroit. AP Auto Writer Tom Krisher in Detroit contributed to this report.
    The Associated Press: Chinese car market overtakes that of United States
    “the misery of being exploited by capitalists is nothing compared to the misery of not being exploited at all” -- Joan Robinson

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