Several years ago, owning a private car was beyond the dream of Liu Min, who used to go to work by bicycle, or sometimes by taxi in bad weather.

Twice everyday, the 36-year-old Liu would join streams of bike-riders for a trip from his home in the western part of Beijing, the Chinese capital, to his downtown office and for another trip in the opposite direction. He spent at least 35 minutes for each trip.

Bicycles are so numerous and ubiquitous in China that the country is dubbed a "Kingdom of Bicycles."

"In fact, going to work by bike is fine with me except in bad weather," said Liu, an employee with China Post.

"But I've always dreamed of owning a car. With a car, it will be a lot more convenient to move around in this big city or go foran excursion in the suburbs. "I love to travel," he said.

Indeed, Beijing is too big for a biker like Liu. But his life has changed dramatically since last February when he bought a sport-utility vehicle for 85,000 yuan (about 10,240 US dollars).

The SUV, called Safe, a homegrown brand, is made by Great Wall Automobile Holding Co. based in Baoding, a city some 260 km to thesouth of Beijing.

For Liu whose annual income is about 36,000 yuan (about 4,337 US dollars), low price is the only reason for him to choose a domestic brand. Similar vehicles made by foreign carmakers like Volkswagen of Germany and Toyota of Japan sell for twice as much at least.

The SUV saves him some 20 minutes on his home-office commute ifit doesn't run into a traffic jam, which is now a growing headachefor big cities like Beijing and Shanghai.

"The car has shown its power to change our family's lifestyle,"said Liu, grinning. The family has since February traveled to the suburbs at least four times. They plan for a trip to Tianjin on a coming weekend.

Liu's dream has come true and his excitement from the first carin his life is shared by a growing number of Chinese. The more affluent 1.3 billion Chinese people are forsaking their bicycles and getting behind steering wheels.

China's two-decade-long economic growth is fueling the ongoing car craze. The national economy has doubled since 1990, boosting people's living standard, especially in major cities and along thecoast, and igniting the desire for a staple of a modern consumer society.

The boom is beginning. As China's economy barrels forward, annual household incomes in major cities are reaching or exceedingthe 4,000-dollar mark regarded as a take-off point for private auto ownership on a massive scale.

At the same time, banks as well as major carmakers in China areplunging into auto-credit business.

More importantly, as Western and Asian auto giants hasten to squeeze into the world's fastest-growing auto market, car prices have dropped significantly in the last four years thanks to competition among these giants.

Zhang Xiaoyu, vice-chairman of China Machinery Industry Federation, said that China's auto production has been growing by 15 percent annually on average in the last decade and that this year China will produce at least 5 million motor vehicles, about half of them cars.

As a host of new models debut each year to lure would-be buyers,a series of price wars have been reshaping the galloping industry since 2000.

Taking Santana made by Shanghai-Volkswagen, a Sino-German jointventure, as an example, its cars first appeared on the market in 1985 and sold for 60,000 yuan (about 190,000 yuan in today's money) apiece. At that time, a typical Chinese worker's annual income wasno more than 1,800 yuan.

The price of a Santana hit 182,300 yuan in 1993 when an ordinary worker earned just 7,200 yuan per annum. Despite sky-highprices, Santana commanded half of China's car market for at least 10 years.

The simple reason for this is that Santana during this period was "the emperor's daughter" - a thing of scarcity that never worried about being not desired.

Since the late 1990s, however, Shanghai-Volkswagen has had to cut prices for its Santana cars almost every year to meet ever-fiercer competition.

The basic version of the Santana sedan now sells for no more than 85,000 yuan apiece. Its market share has fallen to less than 6.7 percent, out of ten top-selling models, according to statistics released by China Association of Automobile Manufacturers.

Market dominance by the Santana ended within about a decade, a period that witnessed the rise of strong competitors as well as private-owned carmakers, like Great Wall Automobile Holding Co.

As Santana is left behind, a stream of new cars have come onto the market with lower prices and prettier look. As a result, owning a family car has come within, or nearer, the reach of the country's growing middle class, like Liu's.

Individuals account for an increasing share of car sales, supplanting purchases by institutions, including government departments and businesses.

Statistics released last June by the National Bureau of Statistics indicate that at least 10 million autos are privately owned in China.

In Beijing, which boasts the highest rate of private car ownership in the country, more than 1.28 million autos are owned by individuals, 64 percent of the city's 2 million registered vehicles.

According to Beijing Traffic Administration, the number of registered motor vehicles in Beijing doubled in only seven years from 1997 to 2003. Of the 1.28 million private-owned vehicles in Beijing, more than 800,000 are cars, according to Zhang Jingli, deputy director of the traffic administration, adding the number is increasing quickly.

"Since early 2003, each working day has seen the registration of 800-900 private cars in the city," Zhang said. "That's around 200,000 units a year."

People in other parts of China are doing the same, though growth is not as fast as in Beijing. According to Chen Hong, general manager of Shanghai GM, General Motor's joint venture in Shanghai, at least 100 million Chinese families are likely to buy cars in the coming 10-15 years - making China the world's No.1 auto market.

According to an estimate by industry officials, annual auto sales in China may reach 10 million units a year by 2010, second only to the United States.

In 2003, China produced 2 million cars, up 83 percent over the previous year, according to China Association of Automobile Manufacturers. China is now the world's fourth largest car producer, behind the United States, Japan and Germany, the association said.

All these serve to explain why US, European and Asian automakers did their utmost to show off their newest SUVs, luxury cars and expensive roadsters at Auto China 2004, the country's biggest auto show, held in Beijing during June 9-16.

Auto China 2004 caps a 12-month period in which foreign automakers have announced additional investments of nearly 12 billion US dollars in China, promising to accelerate the pace at which the country turns from a "Bicycle Kingdom" into a huge car market.

Source: Xinhua