China overtakes U.S. in ’09 auto sales by 3 mln units image

While China auto sales likely soared 44% to 13.5 million units, new car sales in the U.S. last year plunged more than 20% to a 27-year low of 10.43 million, less than the 12.23 million sold in China during January-November, data released by a US research firm showed today, reported.

China has surpassed the U.S. to become the world’s largest car market for the first time. The result marked a historic turning point in the world auto industry, which had been led by the Big Three Detroit companies since Ford Motor Co. began mass production of the world’s first belt conveyor system in 1913.

Sales of passenger cars and other light vehicles in China are expected to have topped 12.75 million units last year, well ahead of a four-decade low of 10.3 million in the U.S., according to recent forecasts from J.D. Power’s Asia Pacific division.

The auto sales growth in China was driven by a number of incentives, including subsidies and tax cuts, rolled out by the Chinese government as part of its 4 trillion yuan ($586 mln) stimulus package during the global downturn.

General Motors, battered at its home U.S. market, sold 1.83 million vehicles in China last year along with its local ventures, up 66.9% year on year. Shanghai GM sold 727,620 units and SAIC-GM-Wuling sold 1,061,213 units.

In 2009, the U.S. auto market was severely battered by the worldwide economic recession. The market also shrank due to reduced operations of GM and Chrysler following their bankruptcy protection.