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Luxury car makers look to increase sales in China

By Li Xiaoshu (Global Times)

08:13, April 23, 2012

Leading luxury car makers are eyeing higher sales and production expansion in China to gain an edge amid intensifying competition even as overall growth fades, according to their latest projections released over the weekend.

Porsche SE announced yesterday that it plans to step up expansion plans in China by increasing its dealerships in the country by more than 40 percent this year.

The maker of the 911 sports car expects the number of Chinese dealerships to reach 60 by the end of the year from 41, Bernhard Maier, the Germany-based carmaker's sales chief, said yesterday in Beijing.

Volvo Car Corp, the Swedish carmaker owned by China's Zhejiang Geely Holding Group Co, told the Global Times yesterday that it aims to more than double the number of models in the country to compete with Volkswagen AG's Audi and BMW AG in China.

Volvo, which currently sells six models in China, is planning to introduce 10 new ones in the country within six years, including bigger and more high-end luxury vehicles, the company said in a statement sent to the Global Times yesterday.

German luxury car maker Audi AG will increase production capacity in China to 700,000 cars a year by 2015 and sell 700,000 cars a year in China later this decade, Audi's headquarters said Saturday.

Bentley Motors, which inaugurated its 19th Chinese showroom Saturday, also plans to open four more this year.

Meanwhile, Japanese automaker Nissan's luxury division Infiniti revealed Saturday that it plans to produce two of its models in factories run by Nissan and its Chinese joint-venture partner starting in 2014.

"The moves help illustrate luxury car makers' increasing focus on China," Yale Zhang, managing director of Shanghai-based Automotive Foresight Co, told the Global Times yesterday. He predicts sales of premium light vehicles in the country will increase by 24 percent this year.

"Luxury vehicle sales are continuing to surge, driven by consumers with deep pockets who are less price sensitive and manufacturer-provided dealer incentives that have lowered consumer-facing transaction prices," John Zeng, China analyst with UK-based automotive consultancy J.D. Power Automotive Forecasting, told the Global Times yesterday.

Luxury cars are the fastest growing segment in China, with sales up by 36.7 percent to 130,416 units from January to March this year, according to the latest estimate by Morgan Stanley in London.

China's overall vehicle sales in the first quarter were flat at 3.15 million units.

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