This file photo shows workers at the Ford-Jiangling China Transit factory lowering the body frame of one of the jointly-designed models on the production line in Nanchang in Jiangxi province. (AFP Photo)

SHANGHAI, China, Feb. 7--China, currently the world's fourth largest automarket, is expected to produce more than six million cars, trucks and buses in 2005, up 20 percent from last year, data showed Monday.
The rise in production would catapult it ahead of Germany and make it the world's third biggest vehicle manufacturer after the United States and Japan, the China Association of Automobile Manufacturers said on its website.
Although Chinese automakers suffered a sharp slowdown in sales in 2004, companies have since adapted to market conditions and sales were expected to accelerate, Zhang Xiaoyu, chairman of Society of Automotive Engineers of China, was quoted as saying by the association.
China's auto market cooled last year but sales were still up 15.5 percent to 5.07 million vehicles after a gain of 34.2 percent in 2003.
Passenger car sales, the hottest market segment, rose 15.17 percent to 2.33 million units in 2004 but were well below the blistering 75.28 percent pace seen in 2003.
The slowdown was in part due to government-imposed loan restrictions meant to reduce the pace of frantic spending on new plant and investment with apparently little thought for potential market demand.
For luxury carmakers Audi and Mercedes-Benz, the slowdown was readily apparent with both German companies reporting fractional sales growth in China last year.
Volkswagen subsidiary Audi said that it sold 64,018 cars here in 2004, up just 0.8 percent from the previous year and well off its target of 80,000, Xinhua news agency reported.
Market newcomer Mercedes-Benz said that its combined sales in the mainland and Hong Kong rose by only 5 percent to 11,500, short of its target of between 13,000 and 14,000 units.
Still, the country's fledgling automobile market is forecast to record very strong annual growth of 10-15 percent this year, much higher than growth rates of less than three percent in developed markets.
According to vehicle output figures given by Xinhua, the United States ranked first last year with 11.96 million vehicles produced, Japan second with 10.51 million followed by Germany with 5.57 million.

The budget for fiscal 2006 which President George W. Bush is to send to Congress cuts funding for a wide array of domestic programs, but increases military and international spending, according to a press report, AFP said.
The budget totals a record $2.5 trillion in spending but does not include future expenses of the ongoing military operations in Iraq and Afghanistan, which will be the subject of separate supplemental requests, The Washington Post reported. The proposal grants the Pentagon an extra $19 billion, bringing its annual operating budget to $419.3 billion for the 2006 fiscal year, a 12-month period starting Oct. 1 this year.
On the international front, Bush has earmarked $3.2 billion for fighting AIDS worldwide in 2006 and increased foreign operations and development aid by 17 percent, the paper said.
The budget will seek three billion dollars for the Millennium Challenge Account, the president's program to help poor nations boost economic growth. The figure is 500 million dollars more than was sought in 2005, but two billion dollars less than projected.
About 150 domestic programs will get the axe or be radically trimmed. Traditionally sacrosanct farm subsidies would be shaved, and the US passenger train network, Amtrak, would no longer receive government funding.
Law enforcement, education and environmental conservation programs would suffer and several public health programs would be drastically cut.
In a television interview Sunday Vice President Dick Cheney called the budget "the tightest budget that has been submitted since we got here" but argued that it is also fair.
"I think you'll find, once people sit down and have a chance to look at the budget, that it is a fair, reasonable, responsible, serious piece of effort," he said on "Fox News Sunday."
"It's not something we've done with a meat axe, nor are we suddenly turning our back on the most needy people in our society," Cheney said.
Bush will propose slashing one billion dollars from the 32-billion-dollar food stamp program, which helps low-income people buy groceries.
The plan includes making Bush's nearly 1.9-trillion-dollar tax cuts permanent while aiming to cut the deficit in half by 2009.
The White House has projected the current fiscal year shortfall would grow to a record $427 billion, up from $412 billion in the 2004 fiscal year.
US finances plunged into the red after Bush first took office in 2001, when he had inherited a surplus.
Bush has blamed the 2001 recession and the cost of the war in Iraq, while his critics blame the tax cuts and his failure to veto any spending proposal in the last four years.
The budget proposal is likely to spark fierce fights in Washington, with stake holders rallying to protect programs dear to their constituents.
"This is a long list of sensitive programs," a congressional aide said of the cuts. "A lot of these proposals we've been through before and the programs have survived. This is going to be a tough sell for the president."
Republican Senator John McCain said the belt-tightening was timely.
"With the deficits that we're now running, I'm glad the president is coming over with a very austere budget," he said on ABC's "This Week" on Sunday. "I hope we in Congress will have the courage to support it."

BANGALORE, India, Feb. 7--US aerospace giant Boeing said Monday it will increase its sales forecast for India from $25 billion to 30-35 billion dollars for the next two decades due to a booming market.
"Growth is remarkable in India," said Dinesh Keskar, Boeing's senior vice-president sales.
"Our earlier forecast was to sell 300 airplanes worth $25 billion over the next 20 years.
"Now the growth levels are high and passenger traffic is growing at about 20 percent every year. This will not be short-lived but one of the things that is going to be crucial here is improvement in infrastructure," Keskar told reporters ahead of Wednesday's opening of India's annual air show in Bangalore.
"Based on the pace of improvement in traffic management, parking facilities and the number of landings one can do every hour, we will decide whether the new forecast will be $30 billion or $35 billion," he said.
The number of air travelers in India jumped 26.5 percent in the first half of the financial year to March with 18.52 million people boarding flights.
The launch of low-cost carrier Air Deccan last year sparked fare cuts that have resulted in 250,000 to 300,000 new passengers every month. Overseas routes are also being opened up to private carriers to boost competition and ensure enough capacity.
The government has also set up an aviation watchdog to oversee a 400-billion rupee (8.69-billion dollar) program to revamp the country's ramshackle airports.
Boeing's Keskar said his firm's new forecast would reflect India's liberalization policies in the aviation sector which has been bogged down by bureaucracy.
"The new forecast will reflect the changes in the aviation sector. New carriers have come up. For a population of more than a billion people there are only 125 jets while in the US there are more than 6,000 aircraft for 300 million people," he said. "We want to enter the lost-cost fray in India."
He said Boeing had submitted bids to state-run Air India to sell 50 aircraft including the 777-200 for long-haul flights.
"We are eagerly awaiting the verdict. The total order, including 35 firm and 15 options, works out to about $7 billion," Keskar said.
Boeing's competitor Airbus is also in the fray.

TOKYO, Feb. 7--Japan's foreign exchange reserves at the end of January fell $3.58 billion from the previous month to $840.97 billion, the finance ministry said Monday, AFP reported.
The foreign currency reserves stood at $821.20 billion, International Monetary Fund (IMF) reserve positions at $6.63 billion, IMF special drawing rights at $2.75 billion and gold at $10.39 billion, it said.
Japan has been the world's biggest holder of foreign reserves for 62 months, the ministry said.

KUALA LUMPUR, Malaysia, Feb. 7--A second round of bidding for two remaining high-speed third-generation (3G) mobile phone licenses in Malaysia may start soon, a report said Monday, AFP reported.
The Star newspaper, citing an industry source, said the government was debating whether to open up bidding to foreign operators.
The government was also considering whether it should limit bids to telecommunications companies or allow any company to bid, it said.
In July 2002, the government awarded 3G licenses to Telekom Malaysia and Maxis Communications.
The two companies are expected to spend 7.5 billion ringgit ($1.97 billion) over the next decade to roll out 3G services later this year.
Malaysia's smallest mobile operator DiGi.com Bhd. last November revived its bid to secure a high-speed 3G license.
Malaysia's mobile phone penetration rate has reached more than 30 percent and the government hopes to speed up adoption rates and reach an official target of 38 percent by 2005 with new 3G networks.
The new technology allows speedy mobile access to data and video through the Internet.

MANILA, Philippines, Feb. 7--Communist insurgents in the Philippines warned that foreign mining activity is off-limits in rebel-influenced areas and such operations faced potential armed attacks, AFP reported.
Communist Party of the Philippines (CPP) spokesman Gregorio Rosal issued the threat amid renewed interest in the moribund resources sector after the Supreme Court upheld a law opening the industry to foreign investors.
The CPP leads the 8,000-member New People's Army (NPA), which has been waging a 36-year Maoist-style campaign in wide areas of the archipelago. The government suspended peace talks with the communists last year.
Many of the known but as yet undeveloped mineral desposits in the Philippines are located in areas controlled by either communist or Muslim insurgents.
President Gloria Arroyo's government said last week that it expects initial development of mineral deposits worth $90 billion.
Rosal, interviewed by DZBB radio here, rejected the Supreme court ruling.
"We will not allow mining companies to operate inside guerrilla fronts," the rebel spokesman said.
"If they (mining firms) insist on the wanton destruction of the environment, our forces are sure to launch all available means to paralyze their operations and force them out of the guerrilla zones," he added.
Arroyo sees the mineral extraction sector as a quick ticket to poverty reduction for the Philippines, where half the population of 84 million earn the equivalent of $2 a day or less.
Arroyo special aide Rigoberto Tiglao told reporters on Friday that the government hopes to develop 23 mining projects with foreign investors.
He put total mining wealth in the Philippines at $840 billion but said most of these reserves had gone untapped due to previous laws restricting mining to local companies.
Environment and Natural Resources Secretary Michael Defensor said the country could earn an additional $2 billion annually if the "23 flagship projects" push through.

A Ford Focus car is seen during the press day at the Paris Motor Show in 2004. (AFP File Photo)

WASHINGTON, Feb. 7--Ford Motor Company is recalling nearly 359,000 of its compact Focus cars because of problems with a rear door that federal regulators said could open in traffic creating a safety risk, AFP reported.
The recall, announced by the National Highway Traffic Safety Administration on Jan, 31, affects four- or five-door models sold in 20 US states plus the federal capital.
The measure was prompted by problems with a rear door latch, which could make it difficult closing and opening the door.
"If not latched properly, the door may open while the vehicle is in motion," the recall announcement said. "If an occupant fell out of the vehicle, personal injuries could occur."
It is the second recall safety problem the second-largest US automaker has faced this year.
Last month Ford announced it was recalling some 792,000 sports utility vehicles and trucks, including its popular F-150 truck, amid concerns that a potentially faulty switch could cause a fire under the hood.

DAMASCUS, Syria, Feb. 7--Syria, which observes a firm boycott policy against Israel, said on Monday it had permitted limited imports of apples produced by Druze Arabs in the Golan Heights, occupied by the Jewish state since 1967.
A Syrian foreign ministry source said that Damascus had allowed the import of 10,000 tons of apples "which is the produce of Syrian land and owned by Syrians" from the Golan Heights.
"In view of the harsh economic conditions under which our kin in the occupied Syrian Golan live and in response to their repeated calls ... it has been decided that (we) purchase 10,000 tons of apples that belongs to our citizens in the Golan," the source said.
The heights are home to around 20,000 Syrians who stayed after the 1967 Middle East war.
Syria is home to an office that oversees the Arab states' implementation of an Arab League resolution to boycott Israel and Israeli concerns worldwide.
The imports from the Golan Heights would be carried out under the supervision of United Nations personnel monitoring the 1973 Arab-Israeli war frontier, said the source.