China car sales slow down in June, labor disputes pose threat
In June, passenger car sales rose 19.4 percent compared to 25.8 percent growth in may.
Market analysts warned that the growth rate could look south in coming months unless the automakers as well as the mainland government move quickly to resolve the labor disputes.
In June, Japan’s no.2 automaker Honda Motor co. faced the risk of disruption in its Chinese business operations when workers at Honda Lock (Guangdong) co. in Zhongshan, Guangdong province, decided to strike. the plant makes locks, mirrors and wheel sensors for Honda cars.
The walkout followed two others at Honda suppliers that crippled the company’s car production in China and forced the automaker to raise wages for some workers by at least 24 percent.
Japan’s biggest automaker Toyota Motor Corp.’s production was also hit in June when workers at a Toyota parts supplier, Tianjin Star Light Rubber & Plastic Toyoda Gosei, staged a walkout, demanding better pay and working conditions. the plant makes rubber weather strips for Toyota cars.
The automaker was also hit by another strike hit called at a Chinese subsidiary of Toyoda Gosei plant in Tianjin. the supplier plant makes instrument panels for Toyota cars.
The Japanese automakers were not the only automakers to be hit by the rash of strikes.
Around 1000 workers at South Korean Hyundai Motor’s auto parts plant near Beijing walked off the job on may 28 and called a strike over the weekend. They returned to work only after the management quickly promised a 15 percent pay rise soon and a further 10 percent rise in July.
According to data provided by J.D. Power and Associates, Honda’s China auto sales fell 10 percent in may. While the automaker has yet to release the sales data for June, Toyota only managed to post a single digit percentage gain in the month.
Market analysts said the rash of strikes had forced the automakers to close or suspend some of their operations in China.
According to Kevin Chen, president of Gasgoo.com, a Chinese auto parts trading platform, if the labor problems are not resolved effectively, “they will come back to haunt” the automakers.
“Growth is definitely slowing, though sales still remain strong,” Guotai Junan Securities analyst Zhang Xin said.
However, some analysts feel that one should not look too deeply into the sales figures in June.
According to IHS Automotive analyst Lin Huaibin, the Chinese market is “still holding up pretty well so far.”
Lin said it’s too much to expect the market to match the phenomenal growth of 2009, when it surged 59 percent. the market growth was primarily driven by tax incentives.
“The growth rate will slow down further in the summer when auto sales have been slack traditionally. the market could pick up again in the autumn, when many people get behind the wheel and travel around with their friends and families,” Lin said.
Analysts said the double digit growth rate in China shows that the Chinese auto market is faring far better than those in Europe or the US where growth is in single digits and tapering off.
Even in India, Asia’s second largest market, car sales are slowing down.
Not surprisingly, many automakers are crowding in China to tap the growing market.
While US automakers General Motors and Ford said they registered 50 percent and 53 percent growth respectively during the first half of 2010 compared to year earlier period, Europe’s largest automaker, Volkswagen AG and Japan’s no.3 automaker Nissan said they would invest in China to expand their production capacity.
<a href="http://www.ibtimes.com/articles/33856/20100709/china-car-sales-slow-down-in-june-labor-disputes-pose-threat.htmtag:news.google.com,2005:cluster=http://www.ibtimes.com/articles/33856/20100709/china-car-sales-slow-down-in-june-labor-disputes-pose-threat.htmFri, 09 Jul 2010 15:23:46 GMT 00:00″>China car sales slow down in June, labor disputes pose threat
It's Japan vs Japan on Indian roads Japanese automakers look to cash in on the Indian love for Japanese products.
& U will do well to pay attention to it, as 2 a light shining in a dark place, until the day dawns & the morning star rises in your hearts.
Yes, when you travel on a dark road or walk on a beach after sunset, you might pay more attention to the light far away, But, the lights right beside you actually show you the way. And these lights are hold by your close families and friends.
And also remember, at a dark night, you can see stars at sky clearly. There might be your mom is watching you. Although the star light can not show you the road, they still can guide you to your destiny.
In your heart, everyone is holding you.
The government had nothing to do with this. When the children were crying and asking for food, why didn't the party guests feed them? If the adults in the house continued to forbid the children to eat, why didn't someone pick up the phone and call the authorities? Depriving a child of food is abuse, after all. The proof was right in front of them. They, along with the neighbors who witnessed the abuse, are the ones who really dropped the ball.
Jack, I am 65 years old and for more than half of my life the American automobile industry has been headed south, while promising to do the right thing in the very near future ……for the last 35 years.
Our family has purchased Honda cars since 1978 and see no reason the change that practice in the future.
It is going to be tough for the US car makers to compete with foreign competition. Unless they change dramatically.
Removing Wagner from GM is the right step at this time.
The car and bank situation require different solutions!
Bob