Gas guzzlers a hit in China

Excerpts from AP's "Gas guzzlers a hit in China, where car sales are booming":

High, wide and fuel-hungry, the gleaming black Cadillac Escalade on display at the Beijing auto show is an unlikely car for an era of record oil prices.

But while sport utility vehicle sales in the U.S. are tumbling, automakers are finding that for China's newly prosperous car buyers, bigger is still better.

So General Motors Corp. has made the Escalade a star of its auto-show display and is eager to get it on the market here.

"If you look at the fastest-growing market segments in China, there are two — SUVs and luxury cars," said Joseph Y.H. Liu, GM China's vice president for sales and marketing.

Auto sales in China are booming, with analysts and automakers forecasting growth at 15-20 percent this year. But demand for the biggest vehicles is even stronger, with sales of luxury cars and SUVs expected to surge by 40-45 percent. [...]

Sales have been boosted by economic growth that has topped 10 percent for five straight years and a surge in real estate and stock prices that created a new crop of Chinese billionaires.[...]

Both foreign and Chinese automakers are using the Beijing show to highlight luxury sedans, muscle cars and SUVs. It opens to the public Thursday after a weekend press preview.[...]

For SUV sales, "the volume is low but the growth rate is high, and we're all trying to get into this segment," said Robert Socia, executive vice president of Shanghai General Motors, a GM joint venture with a Chinese partner.

By contrast, GM's SUV sales in the United States fell 22 percent in March from the same month last year. [...]

"Chinese buyers typically like bigger cars and they have the resources to go for them," said Tim Dunne, J.D. Power's director of Asia-Pacific market intelligence.[...]

Beijing is trying to encourage the growth of China's auto industry and domestic sales — but communist leaders are alarmed at pollution and rising dependence on imported oil, which they see as a strategic weakness. China is the world's No. 2 oil consumer after the United States, and imports rose 12.3 percent last year.

Beijing and other major Chinese cities are among the world's smoggiest, and the rise of big engines and more horsepower is adding to the haze. [...]

"The Chinese consumer is still back on the curve of satisfying their basic need for transportation," said John Parker, Ford Motor Co.'s executive vice president for Asia, "rather than looking at being green."

Comments

[Christopher]

Nothing says "basic transportation" like a pimped out Escalade SUV. Wait, what? Please John Parker, feed us a new line of B.S.