Chery, one of the largest car companies in China and Chrysler’s new partner for building small cars, says that it should be able to sell one million vehicles in 2010. It sold 305,000 in 2006.
The good news for US car companies, especially GM, is that the Chinese auto market is obviously growing as quickly, if not more quickly, than expected. GM sold about 864,000 cars and light trucks in China in 2006. It may not grow as fast as Chery, but it would not seem inconceivable that GM’s China sales could hit 2 million by 2010. For a company that will produce a little over 9 million cars in 2007, that is not insignificant.
The other side of the coin is that Chery may be getting closer to having the financial and production capacity to start sending more cars abroad. It is believed to be planning an IPO next year, which may give it the balance sheet to consider expansion.
Of course, all that US car makers need is another competitor in North American.
Douglas A. McIntyre can be reached at [email protected]. He does not own securities in companies that he writes about.
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