Nissan Motor Co's Chinese car-making venture more than doubled sales in the first half of 2005 to become the country's fastest-growing auto producer, but that pace of expansion suggested it might still undershoot a full-year target.

Dongfeng Motor Co, a 50-50 joint venture between Japan's second-largest auto maker and China's Dongfeng Motor Corp, said yesterday it sold 66,476 cars from January to June, versus 27,204 units in the same period of 2004.

The venture said in March it aimed to move 140,000 Nissan-branded passenger vehicles in 2005, a target that a senior executive told Reuters it was sticking to.

In 2004, Dongfeng Motor Co undershot its own target of 80,000 units when it moved fewer than 61,000 cars.

"Judging by our sales growth in the first half, we became the fastest-growing auto maker in China during that period," said a sales manager at the venture, who declined to be identified.

"In the latter half of the year, we plan to launch a new model, which we expect to be quite popular." Dongfeng Motor Co sells passenger cars under the Nissan banner and commercial vehicles under Dongfeng's.

Nissan's sales are forecast to exceed 500,000 vehicles by 2007/08 in the world's third-largest car market, with the contribution from Dongfeng Motor Co.

China would then be the firm's third-biggest market, behind the United States and Japan.

Last year, its Chinese venture posted an operating profit of 2.5 billion yuan (US$302 million) on a margin of 5.7 per cent.

China, once an easy profit centre providing global car makers with double-digit margins, has become one of the industry's most intense battlegrounds with foreign auto makers investing US$15 billion to triple capacity to over 7 million cars by 2008 - sparking fears of an impending glut.

And the market's heady pace of expansion is slowing: after doubling in 2003, car sales grew 15 per cent last year.

Nissan's venture has said it expected a similar pace of growth in 2005, with pressure on prices remaining, led by General Motors Corp, Volkswagen AG and Hyundai Motor Co.

(China Daily July 5, 2005)