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China and Japan lead Asian car sales surge in August

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Bloomberg reported that Toyota Motor Corporation led the biggest jump in Japan auto sales in 38 years and China’s purchases surged, signaling Asian consumers are emerging from the global recession in better shape than those in Europe and the US. The Japan Automobile Dealers Association said that Japan’s sales of cars, trucks and buses rose by 47% to 290,789 in August from a year earlier. The China Automotive Technology & Research Center said that retail deliveries of passenger cars, multipurpose and sport utility vehicles in China jumped 59% to 977,300.

Japanese consumers rushed to take advantage of government subsidies expiring this month, while dealer discounts in China lured buyers in the world’s largest auto market. South Korean auto sales rose 21% and Maruti Suzuki India Limited, the biggest carmaker in India, reported domestic sales surged 33% after economic growth accelerated last quarter. Mr Ashvin Chotai MD of Intelligence Automotive Asia Limited, an industry consultant, said that "In China, underlying demand still seems to be very strong. In Japan, the market has been artificially propped up by subsidies. We can expect a post-stimulus hangover." Higher auto sales in Asia in August compare favorably with slumping sales in the US and Europe.

In the US, auto sales last month probably were the slowest in 28 years as model year closeout deals failed to entice consumers concerned the economy s worsening and they may lose their jobs. According to researcher Ward's AutoInfoBank, industry wide deliveries may have reached an annualized rate of 11.6 million vehicles last month. That would be the slowest August since 1982. According to the VDA auto industry association, in Germany, incentives totaling EUR 5 billion for buyers of new vehicles who turned in old ones boosted sales 23% last year.

Without further subsidies, new car registrations in the country slumped 29% in the first seven months of 2010. According to the China Automotive center, China car sales may also gain as dealers lower prices to reduce inventories. The average auto stockpile period fell to 57 days in August from 58 days in July 2010. Car buying in Asia may also have been boosted by economic growth in China and India. Sales rose in China even as the nation took steps to slow its economy. The economy grew 10.3% from a year earlier in second quarter, lower than the 11.9% in January to March. The moderation followed government measures to temper credit expansion and property speculation.