Automakers in China are applauding the deal between the Shanghai Branch of the Industrial and Commercial Bank of China and the Shanghai Automotive Industry (Group) Corp. (SAIC) making automobile loans available to consumers. SAIC is one of China's three largest automakers, partnering with Volkswagen AG to build Santana-based vehicles and General Motors Corp. to make versions of the Buick Century and Regal. The bank loans will be made available to individuals as well as various economic entities purchasing cars. Loans will be limited to 80% of the cost of a vehicle and run from three to five years. It is unclear what initial interest rates will be. Until now, loans were available only through car manufacturers and sales agents. Analysts say the move into the auto loan sector by banks could help stimulate sales to private owners. Currently, there are about 8,000 privately owned vehicles in Shanghai, Chinese officials say, compared to about 400,000 in Beijing.

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