BEIJING (Reuters) -- Volkswagen AG continues to sell the most cars in China in the first half with a 38 percent share of the booming market thanks to its two local joint ventures, the official Xinhua news agency said on Monday.
Shanghai Volkswagen Automotive Co. Ltd. produced 202,578 passenger cars in the first six months and sold 192,193 of them, making it China's top auto maker, Xinhua quoted the China Association of Automobile Manufacturers as saying.
FAW-Volkswagen Automotive Co Ltd, VW's venture with China's First Auto Works in the northeastern city of Changchun, manufactured 147,001 cars and sold 130,291 in the same period, it said.
The two ventures grabbed 22.8 percent and 15.4 percent market share in China, respectively.
A total of 842,800 cars were sold in the first half, up 82 percent from a year earlier, Xinhua said. Car sales broke the million mark in China for the first time only last year.
Output roared up 83 percent to 903,400 over the same period, the State Statistical Bureau said last month, exceeding car sales.
Foreign auto makers have announced plans to more than double production over the next four years, raising fears of a margin-sapping glut, but they hope economic growth of eight percent a year will soak up additional output.
Volkswagen, also Europe's biggest car maker, plans to double its annual production in China, its largest market after Germany, to 1.6 million vehicles in five years, to keep its pole position in the Asian giant.
One analyst warned against pumping up output too fast.
"It's a very dangerous game -- demand is not catching up with supply," said Xu Xiang at China Southern Securities.
"Too many products are overlapping and expansion is happening too fast. This will inevitably lead to more price wars and a slide in margins," Xu said.
Xinhua made no mention of possible overcapacity problems.
It said the third-largest player was Tianjin FAW Xiali Automotive Co. Ltd., which has a strategic partnership with Toyota Motor Corp. FAW Xiali sold 74,707 cars and produced 84,328 cars in the first half.
Xinhua did not give the market share for other leading automakers' China ventures, including those of General Motors, Ford Motor Co. or Nissan Motor Co.
But it did say Guangzhou Honda Automotive Co Ltd, an arm of Honda Motor Co., took seventh place. It sold 48,424 cars, just one shy of its total output in the first six months of the year.
Number 10 position was taken by Beijing Hyundai, a joint venture between Hyundai Motor Co. Ltd. and Beijing Automotive Industry Holdings, which sold more than 20,000 units in the first half, Xinhua said.