SINGAPORE -- BMW plans to double sales in Asia in the next five years and sees a strong appetite for luxury cars in China, the German car maker said on Thursday.
Munich-based Bayerische Motoren-Werke AG aimed to sell 150,000 cars a year in Asia by 2008, up from around 78,000 last year and given a big boost by China, where BMW will open a factory by the end of 2003, said Michael Ganal, a member of BMW's board of management.
He said BMW's top Asian market remained Japan, where it sold 46,000 cars last year, but demand was rising fast in China, especially for its top-of-the line 7-series sedan.
"We would like to sell, five years from now, 150,000 cars, given the huge potential we find in Asia," Ganal told Reuters in an interview on Thursday.
"In Asia, Japan is clearly number one with around 46,000 cars sold last year...but we expect a certain move toward China."
BMW's sales in Asia, including its small Mini, rose 28 percent to 78,527 vehicles in 2002. China, including Hong Kong, accounted for 12 percent of Asian sales and was BMW's second-largest market in the region.
Luder Paysen, senior vice president of group sales, said China could overtake Japan as BMW's top Asian market in five years. "China could possibly be the largest market," he told reporters.
BMW faces a tough ride in the first half of this year ahead of a spate of new model launches, with analysts expecting a turning point around the middle of the year as its reaps the benefits of the new product drive.
Its global vehicle sales growth last year outpaced that of key rival Mercedes, a unit of DaimlerChrysler AG, but its profit margins have come under increasing pressure as it pushes through the biggest product offensive in its history.
Luxury car makers such as BMW and Mercedes tend to weather economic slumps better than mass-market manufacturers, although both of the German companies saw a downturn in business in their home market in the last two months of 2002.
BMW sold 1.06 million vehicles last year and said late last month that 2002 revenues had risen almost 10 percent to 42.3 billion euros, although sales in the fourth quarter slipped slightly.
STEERING TO CHINA
Ganal said BMW was not a late entrant into China, the world's fastest-growing major vehicle market. China-based auto makers, including foreign joint ventures, sold 3.25 million vehicles in 2002, a jump of 37.1 percent from 2001, according to official Chinese statistics.
"For premium car manufacturers, we are definitely not late. We will be ahead of some of our key competitors, so I would say, from my point of view, right on time," he said.
Ganal said growing demand for top-end cars in China was reflected in the sales of its 7-series luxury sedan. China emerged as the world's third-largest market in terms of sales of the 7-series in 2002, behind the United States and Germany.
Worldwide sales of the 7-series hit 51,000 last year, including 22,000 sold in the United States, 7,000 in Germany, and more than 2,000 in China. Total Asian sales of the 7-series sedans totalled 8,683 cars in 2002, up 88 percent from 2001.
BMW and its partner Brilliance China Automotive Holdings Ltd., China's largest van maker, are expected to start production of BMW cars by the end of 2003, with a planned annual production capacity of 30,000 cars.
China's auto industry is crowded with about 110 manufacturers, but only 12 have an annual capacity of more than 50,000 vehicles.
Beijing has called for consolidation of the sector, mindful that some domestic players produce only a handful of vehicles a year.