By PATRICIA JIAYI HO
BEIJING—General Motors Co.'s sales in China continued their rapid growth in March, helping to cement China as the U.S. auto maker's biggest market by vehicle sales so far this year.
China sold a record 230,000 vehicles in the country in March, a 68% gain, compared with 189,000 vehicles in the U.S., a rise of 21%. Last year, the U.S. market was still No. 1 in GM's sales, with about two million vehicles sold over China's 1.83 million.
For the full first quarter, GM's sales in China rose 71% to 624,000 units, compared with 16% growth to 477,000 units in its home country, where it is gradually recovering from the credit crisis and a bankruptcy protection filing last year.
However, the China sales growth in the first part of the year looks strong partly because sales in last year's first quarter were severely affected by the financial crisis. China sales growth is expected to slow this month, as the comparison base becomes more challenging. April last year was when China sales gained significant momentum, rising 25% after a mere 5% gain that March, with even faster sales gains in subsequent months.
China last year overtook the U.S. to become the world's largest market for vehicles. Sales rose nearly 50% to 13.6 million vehicles, while in the U.S. they fell 21% to 10.4 million. China has also overtaken Japan to be the world's largest vehicle producer. However, analysts note that the U.S. still leads China by one important measure—the average cost of vehicles sold in China is significantly lower than in the U.S.
Chinese consumers have shown a growing preference for smaller vehicles such as BYDCo.'s F3, GM's Buick Excelle and Hyundai's Elantra – a trend helped by government measures to steer consumers toward smaller cars, including a halving of the purchase tax on small cars.
Demand for GM's smaller models such as the Chevrolet Cruze and New Sail have been particularly strong, the company said.
"This is a clear indicator that many consumers across the country--especially first-time car buyers--are placing smaller, more fuel-efficient products at the top of their shopping lists," said Kevin Wale, president and managing director of the GM China Group, in a statement.
Toyota Motor Corp. said Thursday its sales in China last month rose 33% to 61,200 units in March, as the company used a combination of sales incentives in China to seek to counter any fallout in the country from a massive global recall. Ford Motor Co.'s first-quarter China sales rose 84% from a year earlier to 153,362 units.
Industrywide sales data haven't been released.
The Wall Street Journal
