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Call for car makers stay in green lane
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The current financial crunch should not slow car makers' investment in fuel efficient and eco-friendly vehicles, which are key for the sustained development of the auto industry, analysts said at an auto forum in Shanghai yesterday.

At the CEIBS 6th Annual China Automotive Industry Forum 2008, industrial officials said although the global financial crisis left car makers struggling with a sales slump and profit decline, spending on new technologies is still needed to deal with the rising fuel costs and pollution that may hurt the industry over the long run.

"China's auto industry is still on a fast track with people's growing income and continuous investment (by auto makers)," said Chen Qingtai, research fellow at the Development Research Center in the State Council.

"If we fail to reduce energy consumption and enhance environment protection, conflicts between the auto industry and natural resources would be costly and unsustainable," he added.

Environment protection and energy saving are a high priority on the government's 11th Five-year Plan as a rapidly expanding vehicle population is facing an energy crisis and environmental challenges that harm the auto industry's long-term development.

Besides China, car makers in Europe are also seeking 40 billion euros (US$51 billion) from governments over the next four to five years to invest in fuel-efficient vehicles, said Ivan Hodac, secretary general of European Automobile Manufacturers Association.

Xu Jian, vice president of Volkswagen Group China, said the high fuel prices and the financial crisis made people realize the importance of new energy vehicles and car makers should invest more on cleaner energy vehicles to boost the industry's growth.

Xu said Volkswagen will consider introducing smaller engines in China to meet market demand, and hybrid and electric cars would also be its top priority.

Car makers, including BYD Automobile, General Motors and Toyota, have been investing heavily to produce hybrid and electric cars in China.

(Shanghai Daily November 7, 2008)

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