Expectations that automobile demand in China and India - the second and 11th-largest car markets in the world respectively - would soar over the course of the year have proved unfounded, it has been revealed.

According to Reuters, car sales in China rose at their slowest rate for two years in July - 6.8 per cent - while sales in India fell for the first time in around three years.

This has more than countered the booming demand in Russia, Brazil and the Middle East and has led to a revision of projected growth.

"China is almost three times the size of the Russian car market so for every one per cent reduction in Chinese sales you need a Russian rise of three per cent to offset that," Adam Jonas, Auto Analyst at Morgan Stanley, told the news service.

"For now, Brazil and Russia are helping to soften the blow but we have still revised down our global growth forecasts throughout the year."

Morgan Stanley predicts that global car sales will fall to 58.1 million vehicles in 2008.

This constitutes a 0.3 per cent decline on last year's figures - and contrasts markedly with the forecast earlier this year of a 3.5 per cent rise.


Source:
China slowdown fuels tougher race for carmakers
http://www.reuters.com/article/reutersEdge/idUST8376620080901?sp=true