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China car sales rise 20% as buyers rush to beat expiring tax cut
[BEIJING] China's passenger-vehicle sales climbed for an eighth consecutive month as consumers rushed to buy small-engine autos ahead of a tax cut due to expire at year-end, boosting deliveries at local carmakers including Geely Automobile Holdings Ltd and Great Wall Motor Co.
Retail sales of cars, sport utility and multipurpose vehicles increased 20 per cent to 2.22 million units last month, according to the China Passenger Car Association. Deliveries rose 15 per cent to 18.7 million units in the first 10 months.
Over the past few months, consumers have brought forth their purchases to qualify for a tax cut on vehicles with smaller engines that's expiring at the end of this year, even as the government said it's looking at extending the rebate.
Chinese automakers such as Geely and Great Wall are among automakers that have benefited from the surge in demand for popular SUV models like the Boyue and H6.
"Auto production was expected to accelerate in the fourth quarter in anticipation of an eleventh-hour sales surge as buyers rush to beat the tax cut's expiration at year-end," Steve Man, a Hong Kong-based analyst with Bloomberg Intelligence, wrote in a note.
"Pricing in the passenger vehicle market in China is increasingly competitive. It appears the automakers are resorting to incentives to generate sales."
Geely, which has raised its annual sales target twice, posted an almost doubling of deliveries to 96,158 units in October, while sales for Great Wall increased 31 per cent to 104,844 units.
Deliveries of Guangzhou Automobile Group Co climbed 33 per cent to 158,096 units, while Chongqing Changan Automobile Co's jumped 20 per cent to 293,902 units.
General Motors Co's deliveries rose 5.7 per cent and Ford Motor Co gained 14 per cent. Japanese automakers also saw a pickup in demand, with Nissan Motor Co posting an increase of 16 per cent, while Honda Motor Co reported a 40 per cent surge in sales.