Brand battles in China's luxury car market will intensify with the entry of General Motors (GM)' Cadillac aggressively trumpeting its motto of "Dare to be the First."

Cadillac claims that the luxury cars segment led by "BBC" (Benz, BMW and Cadillac) has come into being in China.

It appears to belittle Audi, Volvo and other luxury brands.

Cadillac will start to deliver its 3.6-litre V6 CTS imports in China later this month.

The CTS, to retail at 518,000 yuan (US$62,560), and Cadillac SRX sports utility will be assembled at GM's joint venture in Shanghai at the end of this year with imported kits, marking the first Cadillac production outside of the United States.

Cadillac will export its XLR convertible to China at the beginning of next year.

"For accomplished individuals with an entrepreneurial spirit, Cadillac is a dramatically new luxury concept in China... Cadillac embodies a bold and pioneering spirit," said Stuart Pierce, Cadillac brand director of the joint venture.

Cadillac's target customers in China include "successful private business owners, highly affluent professionals, movie, entertainment and sports stars, and the second generation rich," Pierce said.

"But we have no specific sales target for Cadillac in China. The most important thing now is satisfaction from our customers and dealers. We expect to sell a few thousand units next year," he said.

China's luxury car market is controlled by Audi of Volkswagen, which kicked off local production more than 10 years ago.

"Brands and services play a decisive role in the luxury car market as all luxury brands do well in technologies and designs with singular and different advantages," said Xia Jun, an auto analyst at CCID Consulting Co Ltd, the Beijing-listed industry consultancy.

"People will not care to pay more or less tens of thousands of yuan when they buy a luxury car like BMW, Benz, Cadillac or Audi," Xia said.

All luxury car makers are promoting their brands with catchy slogans, such as BMW's "sheer driving pleasure," the "advancement through technology" of Audi and "Volvo for life"

BMW began producing its 3 and 5 Series sedans at its joint venture in Northeast China's Liaoning Province late last year. Mercedes-Benz E and C-class sedans will be assembled at its parent DaimlerChrysler's joint venture in Beijing at the end of this year. Volvo will also produce its vehicles at its parent Ford Motor's plants in China in the near future.

Xia predicted luxury cars are expected to account for 10 percent of China's total passenger car market within the next five years, up from around 6 percent at present.

(China Daily September 4, 2004)