China Becomes Second Largest Auto Parts Exporter To U.S.

June 8, 2007
Exported almost $2 billion in first quarter

China replaced Germany in the first quarter as the second largest auto parts exporter to the U.S., Chinese state media said June 8. In the first three months of the year, China exported $1.936 billion worth of auto parts to the United States, up 27.4% on year, the Shanghai Securities News reported, citing figures from the U.S. Department of Commerce.

That is two million dollars more than exports from Germany, but still a distant second Japan with $3.57 billion, the report said.

In the first four months this year, China exported a total of $3.6 billion worth of auto parts globally, a surge of 34.8% year on year, and imports stood at $3.5 billion, up 25.9%.

However, analysts argued higher exports did not necessarily translate into stronger competitiveness as profit margins of German-made auto parts were much larger than Chinese products.

The robust growth of China's auto parts exports has been bolstered mainly by cheaper labor costs, lower raw material prices and looser environmental restrictions, according to a previous report by The New York Times. But these advantages may not be sustainable as wages are rising and the government tightens controls on pollution and exports of resources, the newspaper said.

Copyright Agence France-Presse, 2007

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