Chinese auto sales up in May but domestic brands struggle to keep pace

BEIJING -- Sales in the world's biggest auto market accelerated in May but domestic Chinese brands lagged and their market share shrank, an industry group reported Tuesday.

Sales of passenger vehicles rose 13.9 per cent to 1.6 million, according to an industry group, the China Association of Automobile Manufacturers. Sales for January-May were up 11.1 per cent to 8.1 million vehicles.

Total vehicle sales, including buses and trucks, rose 8.5 per cent in May to 1.9 million.

Auto sales growth in China has cooled steadily since peaking above 40 per cent in 2009. This year's sales are forecast to grow by 8 to 10 per cent.

Passenger vehicle sales by Chinese brands lagged the overall market, rising 5.4 per cent, according to CAAM. Their market share declined 2.9 percentage points from a year earlier to 36.5 per cent.

Domestic brands have struggled to keep up with bigger, richer global rivals. Industry analysts say their quality is improving and they expect sales gains with the planned launch this year of new models by a number of Chinese automakers.

China's economic growth declined to 7.4 per cent in the first quarter after last year's 7.7 per cent expansion tied 2012 for the weakest performance since 1999. The ruling Communist Party's growth target for the year is 7.5 per cent but officials already have cautioned it might come in below that level.

Earlier, General Motors Co. said sales of GM-brand vehicles by the company and its Chinese partners rose 9.2 per cent in May. It said that brought total sales by its Shanghai GM joint venture with state-owned Shanghai Automotive Industries Corp., founded in 1997, to more than 9 million units.

Ford Motor Co. said sales rose 32 per cent to 93,323 vehicles. Year to date, that raised Ford's sales were up 39 per cent to 461,473 vehicles.

Nissan Motor Co., the most popular Japanese brand in China, said May sales rose 3.1 per cent to 106,100 vehicles. It said sales to date this year rose 15.4 per cent to 507,700. Rival Toyota Motor Co. said sales rose 102.7 per cent to 81,100 vehicles.