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The Surge in China's Auto Sales May Soon Slow

A General Motors Co. Chevrolet dealership in Beijing, China
A General Motors Co. Chevrolet dealership in Beijing, ChinaPhotograph by Nelson Ching/Bloomberg

As a long Chinese holiday came to an end Wednesday, drivers heading into Beijing needed more patience than usual. Even on ordinary workdays, big traffic jams are unavoidable in the Chinese capital, as more and more people switch from bikes to cars. And at the conclusion of a three-day holiday for Qing Ming, the traditional festival when Chinese go to the graves of family members, the roads into Beijing were jampacked. That’s life in the world’s largest auto market: Chinese bought almost 16.5 million autos last year, up from 7.56 million in 2009. Vehicle sales in China have jumped more than fivefold in the past decade.

No wonder automakers such as General Motors, Ford, Toyota, and Volkswagen all have great hopes for the Chinese market. GM reported on Apr. 5 that its Chinese ventures sold 258,000 vehicles in March. That’s an 11 percent increase over the same period last year. For the first quarter, sales rose 8.7 percent, to 745,000 vehicles, according to GM’s statement. Volkswagen’s Audi brand is on a roll as well, with the company announcing a 40 percent increase in China and Hong Kong sales for the first quarter of 2012. Sales in March jumped 37 percent, to a record 31,500 vehicles, VW said in a press release.