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Audi, the luxury arm of German auto giant Volkswagen Group, said its sales in China will reach 60,000 vehicles this year, beating its previous expectations.

Audi A6

The sales will include more than 50,000 Audi A6s and 8,000 Audi A4s that are made in China, according to Andreas Deges, executive director of the firm's China operation.

Audi will export some 1,000 of its A8 limousines, TT Coupes, A4 Cabriolets and All-Road Quattros to China this year, Deges said.

The company forecasted in April that its sales in China will total 50,000 vehicles this year, up from 36,500 last year.

"The luxury car segment in China still has great potential for growth and we will most benefit from more in the years to come,'' he said.

"We are the leading manufacturer in China's premium car market and we will not adjust with the competition (from strong rivals),'' said Deges, when asked whether Audi will change its policies next year as BMWenters into the market.

BMW began assembling its 3 and 5 series sedans in October at its joint venture with Brilliance China Auto in Northeast China's Liaoning Province.

Analysts say BMW's move will seriously challenge Audi's reign in China's premium car market.

"More competitors' entry into China will bring the premium car market to a more mature level which will be helpful to us. And we will face a bright future since we are the first to manufacture in China and we understand customers here,'' Deges added.

Audi kicked off production at Volkswagen's joint venture with First Automotive Works Corp, China's biggest automaker based in northeastern Jilin Province, in the middle of the 1990s.

Audi will beef up its brand-building efforts and expand sales networks next year in China to help its growth, according to Deges. The number of Audi-franchised dealers in China will reach 75 at the end of this year.

Models pose for pictures during the launch of the Audi A8L luxury sedan, in Shanghai, China's business capital, October 25, 2003. [Reuters]

"Luxury share in the China car market is far behind other markets around the world," he said, regarding any need for price cuts. "There is no need to decrease prices to push sales volumes in the luxury car segment."

Manufacturers of low-end cars in China are in hot price wars for market share.

More foreign luxury brands will come to China, the world's fastest-growing car market.

Mercedes-Benz of DaimlerChrysler will begin producing its E and C-class sedans in 2005 in Beijing as part of the German-US auto giant's strategic partnership with Beijing Automotive Industry Holding Corp.

General Motors, the world's No 1 automaker, will introduce its Cadillac limousine into its joint-venture effort with Shanghai Automotive Industry Corp next year.

Sweden-based Volvo Car Corp, an affiliate of Ford Motor Co, also said it has interest in producing its cars in China.

Passenger car output in China is predicted to exceed 1.8 million units this year.

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