P&A Providers & Administrators
MenuMENU
SearchSEARCH

Auto Sales in Rural Markets Boost China to No. 1

December 22, 2009
2 min to read


As growing numbers of Chinese shop for their first vehicles, or trade up for newer models, sales in China's immense hinterland are booming, encouraged by tax cuts, government subsidies and growing consumer spending power, reported The Associated Press.


In regions striving to catch up with relatively well-off coastal cities, families and small businesses are gladly swapping scooters and bicycles for the comfort and convenience of the automobile.

Ad Loading...


The supercharged growth has propelled China ahead of the United States as the world's biggest auto market and provided a lifeline for automakers like General Motors and Toyota Motor Corp. as sales crashed in other markets.


The government's role in spurring the market has been crucial, but China's still low level of car ownership points to the potential for decades of strong growth even as some analysts warn the future holds tougher competition and dwindling profits.


To counter a slowdown late last year as the global financial crisis unfolded, the government halved taxes on purchases of small autos and is spending 5 billion yuan (about $730 million) on subsidies for purchases of light trucks and minivans in the countryside, where most of China's 1.3 billion people live.


Earlier this month, the purchase tax was raised to 7.5 percent, though subsidies also increased.


Happy with the results from this year's rescue package for the industry, Beijing is leery of risking a relapse, analysts say.

Ad Loading...


"The message sent by the government is that they will not let the auto industry weaken, especially not in 2010," said Jia Xinguang, chief analyst at China National Automotive Industry Consulting & Developing Corp., an investment management company.


Enticed by the potentially huge market, automakers have poured billions of dollars into ventures here in the past two decades. Total sales this year forecast to shoot past 13 million units, up a third from last year's 9.8 million.

More Industry

Photo of the back of an electric Mercedes
Industryby Hannah MitchellJune 10, 2026

Auto Prices Ride May Moderation

Flat ATPs and asking prices clocked in below long-term averages for the month, though some segments saw significant price gains, reported Cox Automotive.

Read More →
Photo of white Toyota car in front of dealership
Industryby Hannah MitchellJune 9, 2026

Auto Retail Families Get Out While the Getting’s Good

Kerrigan Advisors’ first-quarter Blue Sky Report shows a sharp uptick in buy-sell deals as more retailers take advantage of handsome values while seeking to escape market risk.

Read More →
daytime, front of car dealership Lexus of Vancouver
Industryby Lauren LawrenceJune 3, 2026

Holman Opens New Lexus Dealership

Located in the heart of Clark County, Lexus of Vancouver features a multi-level showroom, more than 30 service bays, an indoor drive for drop-off and pick-up and a fleet of courtesy vehicles.

Read More →
Ad Loading...
Subwoofer in trunk of car.
Industryby Lauren LawrenceMay 26, 2026

Ownership Priorities are Shifting

A new survey shows that in the U.S. vehicle quality for generation Z is largely defined by advanced safety features, intuitive technology and premium sound systems.

Read More →
Man's hand holding gas pump in fuel tank of white car
Industryby Hannah MitchellMay 26, 2026

Pump Price Jump Calculated

ISeeCars.com examined fuel costs for different power trains, finding which ones have experienced the biggest hits since the war in Iran commenced.

Read More →
Graphic showing previous week's truck and SUV segment prices
Industryby StaffMay 20, 2026

Black Book: Weekly Market Update

Wholesale values fell last week despite the spring season still being in the traditional full-gear mode, analysts said.

Read More →
Ad Loading...
Photo of dealership sign with Toyota logo
Industryby Lauren LawrenceMay 19, 2026

Arkansas Auto Group Acquires First Indiana Rooftop

Performance Brokerage Services represented both the buyer and seller in the sale of Carver Toyota of Columbus by Carlock Automotive Group.

Read More →
Headshot photo of Antonio Filosa, Stellantis CEO
Industryby Hannah MitchellMay 19, 2026

Stellantis to Dive Into U.S. Lending

The multinational maker of Chrysler, Dodge, Jeep, Ram and multiple other brands received conditional approvals for a Utah-based industrial bank.

Read More →
Photo of the rear of a new BMW iX SUV
Industryby Hannah MitchellMay 12, 2026

New-Vehicle Prices Rise

With April sales down, higher prices on in-demand large vehicles helped inflate the overall ATP, though increases were under long-term averages, Cox Automotive reported.

Read More →
Ad Loading...
Graphic of car segments' results the previous week
Industryby StaffMay 12, 2026

Black Book: Weekly Market Update

Last week in the wholesale automotive market proved to be a mixed bag, analysts reported.

Read More →