More Chinese Cars in the Pipeline

Volkswagen and its local partner Shanghai Auto said they are jointly developing a new car that will be aimed at North America as well as China. Separately, VW's other partner, First Auto Works, said it plans to spend $1.7 billion over the next eight years to build a range of vehicles it can sell around the world under its own brand name.

The two announcements are merely the latest in a series of moves that are expected to reposition China as a major source of vehicle exports to global markets.

The aggressive export plans of smaller companies such as Geely and Chery have been well publicized. Chery recently enhanced its global image by signing a major deal to supply Chrysler with small cars in various markets.

Now, the big companies are beginning to weigh in with equally ambitious export schemes.

The SAIC-VW sedan will be a follow-up to the recently introduced Passat Lingyu, the partners said.

Independently of VW, SAIC also has developed its own range of vehicles, using technology acquired from the defunct MG Rover group. Those cars will be sold in China under the Roewe brand name and, if SAIC is successful in forging an alliance with rival Nanjing Auto, the same models could reach export markets branded as MGs.

FAW has been developing a broad range of vehicles, primarily for the China market, under the brand name Hongqi (Red Flag). Now the Changchun-based company, one of China's largest automakers, wants to expand its presence overseas with higher-grade models.