JV vows to keep premium market dominance
By Gong Zhengzheng (China Daily)
Updated: 2004-05-13 08:46

Sino-German car joint venture FAW VW expects to maintain its dominance of China's premium car sector by selling 80,000 Audi sedans this year.

Li Wu, vice-president of the joint venture between China's First Automobile Works Corp and German giant Volkswagen, said that the sales figure, up from 60,000 units last year, will include 54,000 Audi A6s and 26,000 A4s.

The sales target is also FAW VW's bid to ward off the threat of increased competition in the sector.

FAW VW yesterday launched two upgraded Audi A4 sedans which are equipped with 1.8-litre turbo manual and 2.4-litre multitronic engines as part of its effort to achieve the target.

The two Audi A4s will retail at between 353,500 yuan (US$42,590) and 500,900 yuan (US$60,349).

And the joint venture will also launch a new Audi A6 next year, said Li.

FAW VW, based in Northeast China's Jilin Province, announced earlier this year that it plans to increase annual Audi output to 150,000 units by 2008.

"We are performing much better than expected, despite great pressures from direct rivals," Li said.

FAW VW sold around 25,000 Audi sedans during the first four months of this year, a year-on-year increase of 27.5 per cent, Li added.

German luxury car brand BMW started to assemble its 3 and 5 series sedans in a joint venture in Shenyang, in Northeast China's Liaoning Province, during the second half of last year.

Mercedes-Benz will also start manufacturing E and C-Class sedans in Beijing at the beginning of next year.

"Price is a very sensitive issue (in China's premium car sector), and we should be very cautious about this," said Li, when asked whether FAW VW will cut the prices of its Audi sedans to deal with challenges from rivals.

The joint venture now has 90 franchised dealers for Audi sedans across China.

FAW VW, China's second-largest car producer following Volkswagen's other joint venture in Shanghai in terms of annual unit sales, is also producing Volkswagen's Bora, Jetta and Golf models.

FAW VW sold almost 300,000 cars last year.

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