Leading global automaker General Motors (GM) yesterday announced that its sales in China grew year-on-year by more than a quarter in 2004, edging it closer to Volkswagen, its biggest rival in the nation.

GM sold 492,014 vehicles in China last year, up 27.2 percent from 2003, according to a company statement.

GM said its market share in China rose to 9.3 percent last year from 8.5 percent in 2003.

Volkswagen earlier this week reported a 6 percent drop in its sales in China last year from 697,000 cars in 2003.

But the German group remains the leading foreign car producer in China, followed by GM.

"For GM and our joint ventures in China, 2004 represented a solid year, despite an overall slowdown in the growth of the vehicle market in mid-2004,"said GM China Group Chairman Phil Murtaugh.

Shanghai GM, the company's flagship joint venture with Shanghai Automotive Industry Corp (SAIC) sold 252,869 cars last year, a year-on-year increase of 25.7 percent.

The sales of its joint venture in South China's Guangxi Zhuang Autonomous Region jumped by 30.5 percent to 235,188 vehicles last year.

"The biggest reason for GM's success in China last year is that it performed better in providing new, attractive and volume products to local customers (than Volkswagen)," said Yale Zhang, the Shanghai-based analyst with CSM Worldwide Corp, the US auto consultancy.

The growth of China's auto market plunged to 16 percent last year from 34 percent in 2003.

"Last year, China's vehicle market moved from unusually high growth to steady and sustained growth. We remain confident about China's overall prospects and expect 2005 to be another positive year for GM and our domestic operations," Murtaugh said.

GM said that it plans to introduce a record number of more than 10 new or upgraded vehicles to China this year.

At present, Shanghai GM produces the Buick Sail, Excelle, GL8, Regal and newly launched Royaum luxury sedan.

GM's venture in Guangxi, with SAIC and local partner Wuling Motor, makes the Chevrolet Spark and Wuling mini-vans.

GM also sells Saab, Cadillac and Opel as imports in China.

The company announced last June that it will invest more than US$3 billion jointly with SAIC and double its annual production capacity to 1.3 million units in China by 2007.

Volkswagen plans to increase its annual production in China to 1.6 million units by 2008.

(China Daily January 7, 2005)