China's vehicle sales are unlikely to bounce back to double-digit levels this year despite the slew of government incentives, analysts and industry players said.

 

Automobile sales in the country rose a meager 6.7 percent from a year earlier in 2008, the lowest in 10 years, according to figures from the China Association of Automobile Manufacturers (CAAM).

 

Vehicle sales last year failed to meet the 10 million target set by CAAM and could only notch a combined sales figure of 9.38 million for cars, trucks and busses.

 

China, which was considered the fastest growing automobile market in the world, had seen three consecutive years of sales growth in excess of 20 percent until last year.

 

"Automobile sales may increase by 5 percent this year. But the key is what kinds of measures the government will take and when," said Dong Yang, secretary general, CAAM.

 

"The consumer confidence is the most important factor weighing on China's auto market in 2009," Dong said.

 

Automobile consulting house CSM Worldwide said global automobile sales will bottom out in 2009 and said it expects China vehicle sales to grow only 6 percent this year.

 

Global Insight, a US-based economics consultancy, expects a 4 percent growth in China automobile sales this year.

 

"Auto sales in China this year may grow even slower, given the current economic woes," said Yang Jian, managing editor of Automotive News China, an auto industry news services provider.

 

"Even with the government's auto industry boosting policies, it is hard for sales to pick up the pace seen over the last few years," Yang said.

 

But China will remain a bright spot in the world as most of the other major markets are unlikely to recover from the negative growth in 2008.

 

Kevin Wale, president, GM China Group, said he expects steady vehicle sales this year and the country to remain as the fastest growing automobile market in the world over the next decade.

 

Toshiaki Otani, vice president, Dongfeng Motor Co Ltd, told reporters in December that in his view Dongfeng Motor's passenger vehicle growth in China this year could be around 14.5 percent, nearly three times the overall projected growth rate of 5 percent.