DaimlerChrysler to beef up China operations

DETROIT, Jan 9, 2003; Reuters is reporting that DaimlerChrysler AG has begun talks with Chinese officials to begin assembling Mercedes C-Class and E-Class luxury cars in a joint venture with a local partner, the auto giant said on Thursday.

"The negotiations are going well, but we don't have a final agreement yet," a spokesman said.

The Wall Street Journal, citing people familiar with the matter, reported earlier the firm expects to have an agreement in place later this year and hopes to set up a plant where Chinese workers would build the vehicles from kits shipped from Germany. It eventually expects to assemble 20,000 to 30,000 Mercedes cars a year in China, the sources said.

A company spokesman said that DaimlerChrysler executive Roman Fischer would take over as the group's head of operations in China, reporting directly to group Chief Executive Juergen Schrempp. He will be charged with expanding the presence of its Mercedes-Benz, Chrysler, Jeep, and truck brands in China.

The appointment, effective from April 1, indicates the importance of the Chinese market to DaimlerChrysler.

Most car companies and industry experts say China will be one of the fastest growing auto markets in the world in coming years.

In recent months other big vehicle makers have set plans to invest millions of dollars in China.