China's top auto firm posts 45 pct 2002 sales rise

SHANGHAI, Jan 16, 2003; Reuters reported that China's biggest automaker, First Automotive Works (FAW), said on Thursday it sold 580,000 vehicles in 2002, a surge of 45 percent from the previous year as domestic demand accelerated.

Turnover leapt 34.8 percent to 84 billion yuan ($10.2 billion) in 2002, breaking the $10 billion mark for the first time, a company official told Reuters.

FAW Car's Shenzhen-listed A shares, open to Chinese and select foreign investors, closed up 1.09 percent at 6.51 yuan, in line with the market's rally on Thursday.

"Our sales were better than expected, helped by the growing market," the official said. "We improved planning, research and development and production in 2002 to make our company more flexible in fulfilling that demand."

Global giants like General Motors Corp and Volkswagen AG are fixing their eyes firmly on a China market that has ballooned in recent years alongside rising incomes, the product of years of robust economic expansion.

China's auto makers sold a combined 3.248 million vehicles last year, 37.1 percent more than in 2001, the State Development and Planning Commission said on Monday.

Annual car sales broke the one-million mark for the first time in 2002, surging 56 percent to hit 1.126 million, the commission said. Those figures took into account Sino-foreign joint ventures based in China.

FAW posted encouraging performances throughout its diverse, nationwide structure, the company official said.

The state firm, based in the northeastern auto city of Changchun, maintains a flagship venture with Volkswagen which sold 207,858 mid-to high-end Bora, Audi and Jetta cars in 2002, a 66.4 percent rise from the year before, the official said.

In August, the company also struck a deal with Japan's Toyota Motor Crop aimed at grabbing 10 percent of the burgeoning domestic car market by producing 300,000 to 400,000 cars a year by 2010. The venture has yet to market its products.

And FAW's domestic listed arm, FAW Car Co, which produces the home-grown Red Flag sedan, saw sales soar 54 percent in 2002, the official said.

He gave no figures, but based on statistics announced, that rise would put sales of Red Flag sedans at about 26,000 in 2002.