Gav - The China Daily reports that China is now likely the world's largest market for new cars, partly due to the government stimulus program pushing buyers to new, energy efficient vehicles - Auto sales 'surpassed US in Jan'.
China may have surpassed the United States to become the world's largest auto market based on monthly sales in January, according to analysts and forecasts. General Motors, the leading US automaker, estimates that China sold about 790,000 vehicles last month.
The government passed a stimulus package for the auto sector last month, reducing the purchase tax on vehicles with an engine capacity of less than 1.6 liters by half to 5 percent. It is also spending 5 billion yuan ($730 million) on subsidies to farmers replacing three-wheeled vehicles or outdated trucks with small, 1.3-liter or less, vehicles.
The push is to promote more energy efficient vehicles while improving the competitiveness of the country's highly fragmented auto industry. About 10 billion yuan is going into upgrading automakers' technology and developing alternative energy vehicles.