Low-Emission Cars Popular In China In 2006

Fuel-efficient cars with low emissions proved popular in China's auto market in the first half of this year, accounting for half of the top-10 best selling vehicles, state media said July 9.

Xiali, manufactured by the Tianjin FAW Xiali Automobile Co. Ltd. and popular for its low energy-consumption, kept its number one position on the list of top selling low-emission cars, Xinhua news agency said. The company sold 93,800 Xiali vehicles in the first six months of this year according to statistics from the China Association of Automobile Manufacturers.

Xiali was followed by the Excelle of Shanghai General Motors and the Elantra from Beijing Hyundai, with sales of 86,900 and 85,400 respectively.

Insiders attributed the popularity of low-emission cars to soaring oil prices and preferential government policies on vehicles with low emissions. China has raised the price of processed oil twice in the first half of this year, hiking costs by 300 yuan (US$37.5) per ton in March and by 500 yuan per ton in May.

Earlier this year, the government also began promoting small, low-emission cars as oil prices remained high and environmental concerns grew over the nation's fast-rising auto culture. It ordered the lifting of restrictions on small cars, which were banned by some local governments due to fears that the cheaper vehicles would cause an explosion in vehicles on the road.

The government is also considering creating a new tax system for the auto industry that would promote low-emission cars and penalize large, petrol-guzzling vehicles. Consumption taxes on vehicles with engines smaller than one liter may be cut from three to one percent, while taxes on engines bigger than three liters are likely to rise from eight percent to 14%-20%.

The number of private cars on China's roads has nearly tripled in five years, with previously released government data showing there were around 17 million last year, up from 6.25 million in 2000.

Copyright Agence France-Presse, 2006

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