Chinese economic planners will implement a range of policies to help maintain the approximately ten per cent growth in the country's auto industry this year, according to reports today (5th January).

It has been suggested that the State Council will unveil a number of initiatives in the first quarter, such as cutting auto purchase tax and incentives for the creation of more fuel-efficient vehicles.

Other measures are thought to include the encouragement of further consolidation in the industry, while government bodies could also be mandated to buy China's self-developed cars in fleet purchases.

The reports follow the considerable slump in the country's auto sales during the second half of 2008 in particular, with November bringing the third consecutive month of declines.

A similar decrease in sales volumes has been experienced in Japan, where it was confirmed today that figures fell to their worst ever levels for December and demand plummeted to a 34-year low.

The Japan Automobile Dealers Association revealed that a total of 183,549 new cars, trucks and buses were sold during the month, representing a record year-on-year fall of 22 per cent.

The body's director, Takeshi Fushimi, was quoted by Reuters as saying: "We never imagined sales would fall this badly. This is a bleak situation."

Despite the doom and gloom, Chinese automaker Geely has suggested today that it plans to expand its auto sales by 25 per cent over the course of 2009, while also avoiding layoffs and suspensions.

The company made the bold claim - which is likely to be supported by the launch of eight new cars this year - in a statement which also revealed that its domestic sales for 2008 grew by 11.6 per cent.

Source:

China to help auto sector with incentives - paper (05/01/09)

http://uk.reuters.com/article/oilRpt/idUKSHA27377420090105

UPDATE 1-Japan auto sales slump, worst December on record (05/01/09)

http://uk.reuters.com/article/governmentFilingsNews/idUKT30253020090105?sp=true

Geely aims for 25 pct car sales growth in '09, no layoffs (05/01/09)

http://www.reuters.com/article/rbssConsumerGoodsAndRetailNews/idUSSHA35823520090105