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Severe overcapacity haunts China's carmakers

Sales of homegrown auto brands are sluggish in China, despite a plethora of special deals.

GUANGZHOU, China -- Excess automobile production capacity in China has become a serious problem that not only erodes the profits of automakers but could stunt the growth of the industry as a whole.

     While the government is now taking action, slashing capacity will not be that easy.

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