Analysts Predict 15 - 20% Growth In Chinese Car Sales, 40 - 45% Growth For SUVs, Luxury Models

[hatrack]

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Auto sales in China are booming, with analysts and automakers forecasting growth at 15-20 percent this year. But demand for the biggest vehicles is even stronger, with sales of luxury cars and SUVs expected to surge by 40-45 percent.

The phenomenon is welcome news for automakers seeing little or no growth in the United States, Europe and Japan. They also make fatter profits from sales of high-end vehicles than from economy models. Sales have been boosted by economic growth that has topped 10 percent for five straight years and a surge in real estate and stock prices that created a new crop of Chinese billionaires.

Buyers of land yachts have also been unintended beneficiaries of a government policy meant to help the poor. Beijing has tried to shield farmers and the urban poor from high oil prices by freezing pump prices for gasoline and diesel, keeping them among the world's lowest. That takes the sting out of filling up a gas guzzler. Gas costs 5.34 yuan (76 cents) a liter or 20.5 yuan ($2.90) a gallon. State oil companies are barred from passing on rising crude costs to consumers, instead covering their losses out of profits from their drilling units.

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GM showed off its new Cadillac CTS sedan, which it said was designed with China in mind. It added a bigger back seat to the basic CTS model sold worldwide, since many Chinese owners sit in back while a chauffeur drives. Cadillac's entry in the SUV competition, the Escalade, can seat up to eight people and gets an estimated 12 miles per gallon. It goes on sale in China next year.

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http://biz.yahoo.com/ap/080421/china_auto_show_big_cars.html

[BeyondGeography]

1. Insane

[NickB79]

2. Hopefully we'll have a few trees left before the end

So we can build gallows for the auto executives.

Or better yet, crosses.

[One_Life_To_Give]

3. Not surprising

I read the Shanghai Boat Show was a busy place this year as well. Lots of new 30ft powerboats for the new professionals in China.