German Auto Company 2002 Plans

DETROIT, Jan 7 Reuters reported that German auto companies on Monday said they aim to expand market share in a stagnant global market this year, following strong 2001 sales in the world's largest market, the United States.

Executives from BMW AG , the Mercedes-Benz unit of DaimlerChrysler and Volkswagen said they believed their luxury products would help them withstand an expected decline in global auto demand this year.

The United States and Germany, which account for the bulk of the German carmakers' revenues and profits, look set to be particularly difficult.

``We look modestly optimistic into the future,'' Mercedes-Benz chief Juergen Hubbert, a board member of DaimlerChrysler, told a press briefing at the Detroit auto show, summing up the mood of the German players who represent the European industry at the show.

``Despite challenging market conditions...we believe that whatever total sales will be this year, chances are good we will outperform the market and our competition.''

The unit of DaimlerChrysler posted a 6 percent rise in 2001 sales to 1,113,200 vehicles.

In an interview with Reuters, Hubbert noted that two of the toughest markets were Germany and the U.S.

He said he anticipated a return to ``normality'' in the U.S. market in the second half of the year at the latest, as the economy moves out of recession.

However, he noted that massive incentives offered mainly by the U.S.'s Big Three -- General Motors Corp. , Ford Motor Co. and the Chrysler unit of DaimlerChrysler -- after the Sept. 11 attacks on the U.S. supported sales in the fourth quarter but had distorted the market, making it difficult to predict 2002 demand.

``What has happened in the last three months is not additional demand but artificial demand,'' said Hubbert. Some analysts said the incentives encouraged American to buy cars last year that they would have purchased later, thus robbing sales from 2002.

He said it was too early to make predictions for 2002 Mercedes unit sales.

``You don't need a record year every year,'' said Hubbert.

He said the high performance Mercedes SL and the new E-Class launched later in the year would help to support U.S. sales.

VW CAUTIOUS

Europe's largest automaker Volkswagen AG also said it aimed to expand its global market share this year despite expected tough market conditions.

``We want to increase our market share and if we see volumes rise as well, I will be a happy man,'' board member Robert Buechelhofer told Reuters in an interview.

VW increased its share of the world auto market to 12.5 percent in 2001 from 12.2 percent a year earlier, despite lifting sales volumes by just 0.4 percent.

However, VW's sales in Germany last year fell about three percent to 990,000 vehicles, underperforming the market which is thought to have fallen only about 1.5 percent.

Buechelhofer said its new large Passat W8 model along with the popular New Beetle would help VW to grow in the U.S.

It will also move into the more lucrative area of sports utility vehicles later in the year with a vehicle it jointly developed with Porsche.

Buechelhofer also said VW was still evaulating the case for producing the Microbus, currently a concept mini bus and that it would decide on that in the first half of the year.

BMW UPBEAT

Luxury carmaker BMW was the most upbeat. Chief Financial Officer Helmut Panke said dealers had said interest in BMW products remained strong.

``We are confident that our positive performance in the United States will continue in 2002,'' said Panke in an interview.

BMW's U.S. vehicle sales rose 12.5 percent to 213,127 units in 2001, outstripping its global sales rise of 10.2 percent. Its U.S. sales dipped in December but Panke said this was mainly due to a strong comparative month in December 2000.

He admitted his estimate for 2002 U.S. sales of 16-16.5 million units was on the optimistic side.

The launch of the Mini in the U.S. is expected to boost the BMW brand and most analysts expect annual Mini sales of 20,000 in the U.S.

Panke also said the company expected sales of the new 7-Series to top the last version's first-year as well as life cycle sales. BMW sold around 327,000 units of the 7-Series over its life cycle and about 50,000 in its first year of 1995.

BMW is one of the few European automakers increasing capacity and Panke said the group had agreed with workers councils to introduce 28 extra shifts at some German plants.