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China Automakers Boosting Capacity to About 21M Units in 2012

Nikkei. The combined capacity of the 10 largest players Chinese automakers is expected to jump from around 12 million units in 2009 to 21 million or so in 2012.

  • SAIC plans a 30% increase over 2009 capacity by 2012

  • China FAW plans to nearly double output capacity

  • Chana Auto Co. plans to build a new plant to be jointly operated with Ford

In 2009, new car sales in China surged 46% to 13.64 million units, vaulting the country past the US to become the No. 1 auto market for the first time ever. According to one industry body, the market will likely expand more than 10% to about 15 million units in 2010.

But market researcher J.D. Power and Associates cautions that the average capacity utilization rate at major Chinese automakers will probably fall to 70% in 2012, down from about 80% in 2009. And, the Chinese government has warned that the industry could eventually face excess capacity.

Comments

HarveyD

China's capacity for accellerated rise in vehicle production and local sales is simply amazing.

Much lower cost basic BEVs (under $10K) will help to boost sales and production even further before 2015.

danm

Somebody better start pumping a lot more oil and building a lot more refineries to keep up with this increased demand. Otherwise, there's going to be dramatic price increases and shortages.

Cameron Dell

Once oil gets to about $125 a barrel. A lot of things shipped from China will become to expensive because of fuel costs. Then manufactures will do better in North America but most things will cost more mostly because of energy cost so the standard of living will go down.

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JMartin

Cameron Dell

You are correct if we remain dependent on oil. If we move to renewable electric rapidly, we could have lower energy prices locally, with shipping costs too high to justify Chinese made goods. That could be a dream, but it is not out of the question.

ToppaTom

I don't think the sales price of Chinese autos is driven much by fuel/shipping costs.

If we don't pump a lot more oil, our economy, if/when it tries to recover, is in for some more bruising.

Reduced consumption and alternate forms of energy do help a lot, but we need "all of the above".

ejj

"Somebody better start pumping a lot more oil and building a lot more refineries to keep up with this increased demand. Otherwise, there's going to be dramatic price increases and shortages."

Iraq & Brazil are already on it. OPEC has a lot of capacity also after reducing production. Venezuela is projected to have a lot more oil than originally thought also.

SJC

Let China buy as much high priced oil as they want, it give others a competitive advantage. China could go EV in the cities, but they already build a new coal fired power plant each week to power the new TVs and refrigerators.

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