News / Asia

China Overtakes US as World's Biggest Auto Market

Chinese automakers say surging sales in 2009 have helped China to overtake the United States as the world's biggest auto market.

The China Association of Automobile Manufacturers said Monday its members sold 13.6 million units in 2009, an increase of 46 percent over the previous year. In the United States, industry figures show only 10.4 million vehicles were sold last year, a 21 percent drop from 2008.

Analysts say the Chinese government boosted its auto industry last year by offering consumers incentives such as tax breaks and subsidies.

Rising incomes in Chinese cities also have made private car ownership affordable for many people for the first time.  The analysts expect Chinese auto sales to continue growing in 2010 but at a much slower pace of around 10 percent.

The Obama administration is trying to give U.S. carmakers another boost by praising them for unveiling new vehicles that feature green technologies at a major U.S. auto show.

U.S. Transport Secretary Ray LaHood says the North American International Auto Show that began Monday in the mid-Western city of Detroit marks a "new beginning" for the industry.

His appearance at the event is aimed at supporting U.S. automakers after the Obama administration rescued General Motors and Chrysler from bankruptcy last year with an $80 billion bailout.

LaHood says the bailout was a "good investment" in an industry that represents one of the "pillars" of the U.S. economy. He says the administration knows that as the U.S. auto industry comes back, the economy as a whole will come back.

In another boost to the industry, the Obama administration said Monday it will provide $187 million to U.S. companies to help them develop more fuel-efficient heavy trucks and passenger vehicles.

The Energy Department says more than $100 million of the grants will come from the U.S. government's $787 billion stimulus package. The funding is part of the administration's efforts to combat unemployment by creating jobs through clean-energy projects.

GM vice chairman Bob Lutz welcomed Washington's increased focus on his industry. He told auto experts Sunday U.S. policy makers previously did not offer U.S. automakers the same kind of support that he said rival companies in Asia and Europe receive from their governments.

Some information for this report was provided by AP, AFP and Reuters.

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