The total sales of all types of vehicles in China, the world's largest car market, increased by 6.1% year-over-year (y/y) to 20.17 million units (on factory shipment basis) for the period between January and November 2014. Passenger car sales alone in China  rose by 9.2% y/y to 17.64 million units for the same period. The strong sales of passenger cars supported the Chinese car market, since there was a decrease in sales of commercial vehicles. The China Association of Automobile Manufacturers predicts that total sales for all vehicle types will be around 23 million units for the full-year 2014.

 The Volkswagen (VW) Group has the top share in the Chinese car market. The group sold 3.25 million units between January and November 2014 in China, a 16.0% increase y/y, expanding its share by more than 1% to 15.4%. General Motors Company (GM), second only to VW, sold 1.67 million units for the same period. GM recorded a 11.3% growth y/y, moderately expanding its share to 7.9%. PSA Peugeot Citroen and Ford Motor Company also largely increased their sales volume in China.

 Under these circumstances, European and U.S. automakers are actively investing in China, expecting the market to further grow. VW and GM in particular plan to invest in China, in order to increase their production capacity to over 4 million vehicles each. In response to these automakers' investments, European and U.S. automotive parts suppliers are also strengthening their production and research and development (R&D) capabilities in China.

 This report summarizes activities of key European and U.S. parts suppliers in and around Shanghai, in eastern China, between the end of 2013 and mid-December 2014. Activities in other regions will be reported separately.