Brilliance shows off new sedan, London-style cab

BEIJING, May 29 (Reuters) - Brilliance China Automotive Holdings showed off its new car on Wednesday, moving the minibus maker into a market dominated by rivals like China's First Auto Works and Germany's Volkswagen.

The new Zhonghua sedan would hit the market this autumn and would be priced between 150,000 and 250,000 yuan ($18,000 and $30,000), company executives told a news conference in Beijing. Brilliance said it had been receiving technical support from engineers with Germany's BMW (XETRA:BMWG.DE - News), which one analyst said could pave the way for the firm's plans to set up a separate car joint venture with the luxury automaker.

"The approval of the Zhonghua project has been seen as a prerequisite for the approval of the BMW JV, so the news bodes well for the prospects of the later venture," Hong Kong's DBS Vickers Securities said in a research note.

Brilliance spokeswoman Suo Yan told reporters the BMW venture was still in the process of getting government approval.

However, the Zhonghua will enter a tough market crowded with cars from the country's top car maker First Auto, as well as with foreign cars like GM's (Montreal:GM.M - News) Buick Regal and Volkswagen's (XETRA:VOWG.DE - News) Jetta and Passat.

"Zhonghua is unproven in terms of branding and quality. With increasing competition from foreign brands, we are sceptical if Zhonghua can be competitive," DBS said.

Brilliance also showed off a a new minivan and a roomy, London-style taxicab made from the design of Britain's Manganese Bronze Plc (London:MNGS.L - News).

Set to roll out of factories next year, the cab has garnered interest from high-end hotels and tourist agencies, Suo said.

Brilliance shares fell nearly three percent in Hong Kong on Wednesday, a day after a newspaper report said the Chinese government could take over the company. That report triggered a fall of nearly 7 percent on Tuesday.

The company said on Wednesday it had received no notice from any Chinese authority about a possible government takeover.