Car Sales Accelerate Despite Snowfall

Led by Volkswagen AG's joint venture, China's passenger car sales posted their highest growth in 18 months last month as strong market demand helped offset production disruption and delivery delays caused by heavy snow.



Domestic car makers sold a combined 638,674 units of sedans, sport-utility vehicles, multi-purpose vehicles and mini-cars in January - an increase of 32 percent from a year earlier, the China Passenger Car Association said yesterday.



The sales growth was greater than the average 20 to 25 percent gain since June, 2006.



Production expanded year-on-year by 14.5 percent to 565,520 units during the same period.



"It's rare for January sales to surpass the December level, especially after a serious snowstorm," said Rao Da, the association's secretary-general, in the statement.



"Strong market demand during the year-end and pre-holiday sales season helped to reduce dealers' stocks."



Shanghai Volkswagen Co Ltd, the joint venture of Volkswagen AG and Shanghai Automotive Industry Corp, was the best performer, with sales of 46,133 units last month.



It was trailed by FAW Volkswagen, Shanghai General Motors, Tianjin FAW Toyota and Dongfeng Nissan Motor Corp.



The country's worst snowfall in five decades forced car makers including General Motors, Toyota and Nissan to shut down production and delay deliveries, causing a slump in both sales and production on a monthly basis.



Rao estimated that the snowstorm will add 10,000 units in sales for February, lifting the total to more than 400,000 units.