China's auto market may expand 7 pct this year - industry body

(Rewrites headline and lead; adds details) BEIJING, Jan 12 (Reuters) - China's vehicle market, the world's biggest, may expand 7 percent this year, roughly matching last year's growth, although just half the pace of 2013 as the economy slows, an industry body said on Monday. The slowdown has fuelled tension between global automakers and China's car dealers, who accuse brands such as BMW and Toyota Motor Corp of setting unrealistic targets and forcing them to buy more cars than they can sell. China's economy is embracing the "new normal" of slower growth, and the auto market is also entering an era of "stable increase," the China Association of Automobile Manufacturers (CAAM) told a news conference in the capital. The CAAM forecasts China vehicle sales, which include passenger cars and commercial vehicles, to grow 7 percent to 25.1 million units this year, in line with economic growth. That is similar to the pace of 6.9 percent in 2014. But some analysts are more pessimistic, predicting weaker appetite for cars in an economy that may cool further this year, after expanding last year at its slowest in 24 years. China's auto market growth could slow further this year, to 3 percent to 4 percent, said Yale Zhang, managing director of consultancy Automotive Foresight. "Growth figures will likely be ugly," he said, citing factors such as continued sluggishness of the economy, a larger comparative base, and dealers' backlash against automakers. Chinese dealers of BMW, Porsche and a Toyota Chinese venture have banded together in talks with the carmakers over subsidies and sales targets, as they fight over who should bear the brunt of slower growth. Reflecting diverging fortunes, Volkswagen AG, which grabbed the top spot last year in a close race with General Motors Co, has said it is ramping up expansion in China to keep up with demand. Ford Motor Co, which has overtaken Japanese rival Toyota in China, also attributed a recent slowdown in sales there to a shortfall in production capacity. (Reporting by Beijing Newsroom; Writing by Samuel Shen and Brenda Goh; Editing by Clarence Fernandez)