China’s automobile market may have a hard time maintaining even 10 percent growth this year, auto.hexun.com wrote in a report today.
According to first quarter sales results released by the China Association of Automobile Manufacturers (CAAM) earlier this week, the market overall declined 7 to 8 percent this March, a striking contrast when one considers the market was growing around 70 percent at this time last year.
At the end of last year, most in the industry believed that growth of 10 to 15 percent would be a very reasonable target for the industry in 2011.
However Dong Yang, deputy chairman of the CAAM, pointed out that outside of the phasing out of preferential purchasing policies and introduction of vehicle purchase restrictions, the country has had to also deal with the cost of oil rising due to increased Middle Eastern turmoil, and especially the earthquake last month in Japan.
“The earthquake’s influence is not only limited to Japanese automobile, but extends to primary and even secondary and tertiary [autopart] suppliers,” Mr. Dong stated.
“Furthermore, [because] there is no clear information, or even no information at all, as to when Japan will begin resuming normal levels of production, it’s hard to calculate just how far the impact of the earthquake goes.” Mr. Dong stated that it would the market may not reach 10 percent growth this year.