1.8 million cars sold in China for first-half 2006: only half are “economy”

The top-three selling “economy” cars – the 5 litre/100km (47 miles per gallon) Xiali, manufactured by the Tianjin FAW Xiali Automobile Co; the 6 litre/100km Excelle of Shanghai General Motors; and the 7 litre/100km Elantra from Beijing Hyundai – accounted for just 14% of the total new car market in China in the first six months of 2006.

The Xiali, manufactured by the Tianjin FAW Xiali Automobile Co. Ltd. and popular for its low energy-consumption, kept its number one position on the list of top selling low-emission cars, according to Xinhua news agency, selling 93,800 in the first six months of the year, said Xinhua.

China sold 1.804 million cars in the domestic market in the first half year, up 46.9% year-on-year, CAAM statistics show.

Earlier this year, the government also began promoting small, low-emission cars as oil prices remained high and environmental concerns grew over the nation’s fast-rising auto culture.

It ordered the lifting of restrictions on small cars, which were banned by some local governments due to fears that the cheaper vehicles would cause an explosion in vehicles on the road.

The government is also considering creating a new tax system for the auto industry that would promote low-emission cars and penalise large, petrol-guzzling vehicles.

Consumption taxes on vehicles with engines smaller than one litre may be cut from 3% to 1%, while taxes on engines with capacity bigger than three litres are likely to rise from 8% to 14-20%, said Xinhua.

The number of private cars on China’s roads has nearly tripled in five years, with previously released government data showing there were around 17 million last year, up from 6.25 million in 2000.

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