Vehicle sales in China, the world’s biggest auto market, rose a paltry 4.3% in 2012 the second straight year of single-digit growth after 2010, as a slowing economy and rising fuel costs weighed on China’s market demand.

But despite a slowdown in demand, China’s vehicle industry association says that vehicle sales in China could rise 7% in 2013 as the country is still relatively attractive for foreign automakers. Yin Hang

Figures from the China Association of Automobile Manufacturers show that China sold around 19.3 million vehicles in 2012. It rose 4.3% last year, up from 2.5% growth in 2011. But last year’s growth is still far below the robust double-digit expansion seen in 2009 and 2010.

China sales for Japanese brand cars slowed after a territorial row caused an outbreak of anti-Japanese sentiment in mid-September. Offsetting the drop in demand for Japanese cars, German vehicle sales picked up significantly last year in China.

Chen Shihua, Spokesman of CAAM, said, "Vehicle sales last year started picking up after April. It recovered to a similar level in 2011 before July. Among them, passenger car sales in China was accelerating. Sales of passenger vehicles surpassed 15 million units in 2012, up 7% year-on-year."

In December alone, passenger vehicle sales jumped 6.9% to reach more than 1.46 million units.

Industry insiders say passenger car sales will do slightly better in 2013, when China’s total vehicle sales are likely to rise 7%.

Shi Jiahua, Deputy Sec. General of CAAM, said, "We expect China’s total vehicle sales in 2013 to see stable growth, hitting more than 20.6 million units. That’s an increase of around 7 percent year-on-year."

A survey of 200 automotive executives, issued by advisory firm KPMG, shows that China remains as a top investment destination for global automakers due to its domestic demand and export opportunities.

But as traffic congestion and environmental protection are becoming increasingly serious in big cities like Beijing, the Chinese government is taking additional measures to tackle the problems. Experts say that might slow China’s vehicle sales in 2013."

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