Chinese automakers shipped 18.7% more passenger cars to dealerships last month, lagging behind a nearly 60% increase in retail sales, Reuters reported. The difference implies that car manufacturers are helping dealers draw down their inventories in anticipation of a future slowdown in sales. Inventory stock at dealerships has been steadily increasing since May. The increase in sales is an improvement over July, when sales increased by only 13.6%, and analysts attribute the recovery in August sales to new subsidies from Beijing for consumer purchases of energy-efficient cars. There is debate over prospects for the rest of the year. Zhang Jianwei, vice president of the government-affiliated China Automotive Technology & Research Center (CATRC), said that the rest of the year should be good for sales, especially as consumers rush to purchase cars before the subsidy scheme is withdrawn. Car manufacturers, however, are predicting slower growth. Jeffrey Shen, president of Ford China (F.NYSE), projects annual sales growth between 15-25% in 2010. "There is no market that can continue to have 40-50% growth," he said.
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