Top Biz News

BMW joins the big pitchers in China

(Shanghai Daily)
Updated: 2006-12-05 15:13

For car makers, bigger is still better in China. BMW AG launched its long-wheel new 5 Series inShanghaiat the weekend, becoming the third car maker within three months to offer specially designed bigger models in China after the Audi A6L and Lexus LS460L.

The new BMW 520Li, 525Li and 530Li will only be available in China and will play an important sales role for the world's second largest auto maker, according to Christoph Stark, president andchief executive officerof BMW Group China.

Car makers are incorporating size and luxury features to cash in on China's strong purchasing power, with a view to the global bottom line.

Munich-based BMW expects its sales in China will grow about 50 percent following a 54.2 percent jump to 24,000 sedans last year. Its global sales growth was only 9.9 percent.

The luxury car segment led the growth of auto sales in China for the first 10 months of this year, Automotive Resources Asia Ltd said yesterday.

Luxury car makers, including BMW and Audi, saw sales in the period soar 70 percent to 124,029 units from a year earlier.

Boom time

The sales jump is almost double the growth of the total passenger vehicle market - 37 percent to 3.3 million units.

Compact car models grew 45 percent, to 1.1 million units, or second overall, followed by mid-sized sedans, which climbed 41 percent to 576,465 units during the same period.

"The luxury car segment is booming from a fairly low base," said Benjamin Asher, a director of the Bangkok-based Automotive Resources consulting firm.

There are sales of about 10,000 units a month, for a share of under 4 percent of the total passenger vehicle market.

New luxury car competitors, such as Toyota Crown, Mercedes-Benz E-Class and Volvo S40, are expected to continue the growth trend - and add pressure for a price drop.

Meanwhile, Shanghai General Motors, a joint venture of General Motors and Shanghai Automotive Industrial Corp, has introduced another Chinese-made Cadillac SLS after halting local production of other models.

"If the price is right, the big comfortable vehicles will always win over the Chinese customer,"Asher said.