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BMW Races for Piece of China
On the verge of setting up its first joint venture in China, German carmaker BMW is looking to become the country's dominant luxury car provider by 2005, according to a senior BMW executive.
Gunther Seemann, head of BMW's China operations, said the carmaker was very confident about China's luxury automobile market because of remarkable rises in income levels and China's imminent entry into the World Trade Organization (WTO).
Seemann, speaking at a BMW test-drive event on Friday in Beijing, said the company planned to sell more than 5,000 cars in China this year.
In 2000, BMW doubled its sales in the country year-on-year to 3,750 units. Audi, a luxury automaker associated with Volkswagen, sold more than 18,000 cars in China last year.
BMW is awaiting Chinese Government's approval for a 50-50 joint venture in co-operation with China Brilliance Group, a company listed on the Hong Kong and New York stock markets.
Seemann did not give a specific timetable for the project and did not reveal which models would be produced in China.
But sources close to the two companies have said the project was expected to be approved late this year or early next year. They also revealed the joint venture would manufacture BMW 3 and 5 series cars with a price range of between 400,000 and 600,000 yuan (US$48,190 to US$72,280).
Seemann hinted that BMW's only real competitor in China's luxury market would be Stuttgart-based carmaker Mercedes-Benz.
Industry observers, however, have said BMW could not discount competition from other luxury carmakers like Audi and Ford's Volvo, which are currently grasping for shares of the Chinese market.
Analysts said the BMW 3 and 5 series, Audi's A6 and A4, the Mercedes-Benz C-class and Volvo's S-60 are all form part of the same market segment in China.
Audi's robust sales last year depended mostly on A6s made in the Changchun-based FAW (First Automotive Works) Volkswagen factory.
Seemann estimated BMW's sales in China during the first five months this year at 2,400 units.
He said the test-drive activity was part of the efforts to consolidate BMW's brand image in China.
BMW also conducted test-drive events in Shanghai, Guangzhou, Chengdu and Xiamen earlier this year.
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