Despite the slowing economy, Winfried Vahland, CEO of Volkswagen Group China, still predicts VW will post a modest sales gain in 2009.

 

"One [scenario] is for a steady market, perhaps with slight growth. That's the most optimistic and the most probable," Vahland said in an interview with Automotive News China in Beijing.

 

"The other is for a slight decrease in the market," he said. "It's unlikely, but I have to be ready for both possibilities."

 

"The situation now makes it very hard to give a more specific prediction," he said. "But we are well prepared. In either case we plan to outperform the market."

 

For the year ahead, Vahland sees these trends:

 

-- Market share of the compact segment will remain stable.

 

"China is not like India where small cars dominate," he said. "The compact segment has grown from 42 percent of the market to 50 percent in the past three years. We predict it will remain the largest."

 

-- The share of smaller cars and SUVs will remain stable or increase slightly.

 

"In the past year the very small car segment has deteriorated," said Vahland. "That might come back in the long term because of city overload, and traffic and parking restrictions."

 

-- Hatchback sales will grow.

 

"Hatchbacks are for young professionals living in cities, and this class is emerging. That's why we decided to bring the Golf VI to China in 2009," said Vahland.

 

Last year VW sold 1.02 million cars in China, according to recently released company figures. That was an increase of 12.5 percent on 2007, well above total market growth of 7 percent.

 

Over the same period, VW sold 1.06 million cars in its home market of Germany, up 0.4 percent from the year before.

 

Given the difference in long term growth trends, Vahland said China will likely become VW's largest market in 2009.

 

Yet he was keen to downplay this achievement. "We concentrate on our own performance here," he said. "I'm not going to talk about what will happen in Germany."