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Auto sales in China may China capitulates: Another round of auto stimulus

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Auto sales in China may rebound next year, helped by a tax cut
to 5% from 10% for small vehicles with engines up to 1.6 liters.
Local automakers such as Great Wall and Wuling may get the
biggest boost, given 83% of their sales are from small cars.
Japanese brands, known for economy vehicles, have the lowest
mix of small-car sales in China. SUV sales may surge further,
with many automakers offering compact SUVs that qualify for
the incentive. Growth is unlikely to be as high as in 2009, with
the same tax cut.

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Auto sales in China may rebound next year, helped by a tax cut to 5% from 10% for small vehicles with engines up to 1.6 liters. Local automakers such as Great Wall and Wuling may get the biggest boost, given 83% of their sales are from small cars. Japanese brands, known for economy vehicles, have the lowest mix of small-car sales in China. SUV sales may surge further, with many automakers offering compact SUVs that qualify for the incentive. Growth is unlikely to be as high as in 2009, with the same tax cut.

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