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China gains ground in Geneva

From Detroit News| March 08 , 2007 14:45 BJT

Chinese companies have vehicles on display at the Geneva International Motor Show for the first time this year, underscoring the growing role of China in the global auto industry. That includes the United States, where DaimlerChrysler AG's Auburn Hills-based Chrysler Group recently finalized a deal with China's Chery Automobile Co. to build small cars for sale mainly in North America and Western Europe under its Dodge brand.

China gains ground in Geneva

China's Brilliance unveiled three models Tuesday in Geneva that are about to be launched across Europe, while Chinese-owned Ssangyong Motor Co. displayed the Actyon Sports, a combination SUV-pickup with a towing capacity of more than 4,000 pounds and interior amenities such as heated seats.

"This day represents a milestone on the journey that will make cars made in China popular," said Hans-Ulrich Sachs, managing director of HSO Motors Europe, a Luxembourg-based company that will import Brilliance models. "We will stand by our mission to offer European consumers vehicles with a good price-performance ratio, quality and safety."

Phil Murtaugh, a former General Motors Corp. executive who is now director of Ssangyong's board, said "Europe is our most important market."

This is the third wave of Asian imports to hit the European market. But while the Japanese took about 20 years to establish themselves, agreeing in the 1990s to voluntary quotas, and Korean makers took more than 10 years to get a foothold, some experts believe the Chinese will need less time to become serious players.

The Brilliance vehicles unveiled in Geneva -- named the BS6, the BS4 and the BC3 -- look sharp, which is perhaps not surprising given that they were developed by Giugiaro, Italy's renowned coachbuilder, with engineering work by Germany's Porsche AG.

The BS6 is built at a factory jointly operated with BMW AG in Shenyang, near China's border with North Korea.

According to Sachs, the plan is to sell 15,000 cars in Europe by the end of 2007 and set up 2,000 dealers. The company is aiming for 75,000 unit sales a year by 2009.

Sales will begin in Germany, followed by France, Italy, Spain, Portugal and Greece. Minor markets will follow in 2008, although there are no plans yet to sell in Britain, which is the only European country that requires right-hand drive vehicles.

The BS6 is a sporty sedan, about the size of a BMW 3-series, with 4-cylinder engines from 2.0 liters to 2.4 liters. The BS6 Comfort costs about $26,000. The top-of-the-range 2.4L costs an extra $2,600 and provides twin-airbags, a choice of manual or automatic transmission, electric-powered mirrors and headlight leveling. Performance is adequate rather the exciting.

An early handicap in Europe is the lack of a diesel engine.

The BS4 is a compact sedan about the size of a Ford Focus with a 1.8 liter petrol engine developing 136 horsepower, or a turbo charged version with 170 horsepower. The sporty two-door Coupe BC3, designed by Pininfarina of Italy, is in concept form only, but will be on the market in Europe by the end of the year. The BC3 is powered by a 1.8 liter turbo-charged engine. Prices of the two smaller vehicles have yet to be decided.

Sachs, who shocked the assembled media by starting his presentation an unprecedented five minutes early, said Brilliance was opening the doors to Europe.

Ssangyong, a South Korean carmaker owned by Shanghai Automotive Industry Corp., began exporting SUVs to Europe two years ago and sold close to 60,000 last year, Murtaugh said.

SAIC, China's largest passenger car maker, has production ventures with GM and Volkswagen AG and also acquired the rights to build Rover 25 and Rover 75 cars, now badged Roewe. Its deal in 2004 with Ssangyong marked the first overseas acquisition by a Chinese vehicle manufacturer.

As for the prospects of Chinese automakers exporting vehicles to the United States, GM Chairman and CEO Rick Wagoner said "I don't think they're going to come for a while."

He said he believed the Chinese were reluctant to tackle the U.S. market until they're confident they have the right vehicles. "The Chinese are incredibly smart," Wagoner told reporters in Geneva. "The Chinese government is being very thoughtful about export policies."

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