Combined profits from China's automobile
industry rose 46% to US$9.9 billion in 2006, the first increase in three years, state media reported. Industry profits on items including vehicles, engines, spare parts and motorcyles fell 24.3% and 5.2% in 2005 and 2004 respectively. The 2006 turnaround was driven by stronger than expected vehicle sales – up 47.7% – and the launch of a record number of new models. However, profit growth is thought likely to fall to 15% this year on the back of a slowdown in vehicle sales and bigger price reductions.