Ford is thinking of selling its top-of-the-line Lincolns in China, according to company executives. Why not? Mercedes-Benz and Audi notched sales gains exceeding 35% last year, easily outpacing a sluggish market there. In 2011, passenger car sales increased only 5.19%, a reflection of inevitable slowing after a period of torrid growth, especially in 2009 and 2010.

David Schoch, chairman and chief executive of Ford China, says his company will outperform the China market, the world’s largest, in 2012. He needs to do that in order to justify big bets Ford has made in Chongqing, where it opened a $490 million passenger car factory late last month.

The China Association of Automobile Manufacturers forecasts sales in the country to increase 9.5% in 2012, but that’s optimistic. “The best scenario is for annual car sales to remain flat, even if automakers try harder in the latter half,” says Zhang Xin of Guotai Junan Securities. “The current official forecast for about 10 percent growth doesn’t look realistic.”

So far, Zhang looks correct as the year has not started out well. Car sales plunged 23.8% in January. The Lunar New Year break adversely affected the number, but the results for the first two months, when they are aggregated to eliminate the holiday effect, may not look much better. According to analyst estimates, sales for the January-to-February period will fall 3% from the same months in 2011. If that happens, it will be the worst start to a year since 2005.

http://www.forbes.com/sites/gordonchang/2012/03/04/fordgetaboutit-china-to-buy-only-domestic-branded-cars/