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Zhongxing Auto secures US exports

Geely

Hebei-based Zhongxing Automobile said yesterday it would become the first mainland company to export sports utility vehicles and pick-up trucks to the United States by the end of the year.

The company's vehicles will be distributed by New Jersey-based Chamco Auto West to Alaska, California, Hawaii, Idaho, Montana, Nevada, Oregon, Washington and Wyoming, according to a statement on Chamco West's website.

The statement did not specify sales targets.

Success for Zhongxing Automobile would mark a breakthrough for the mainland car industry, given the high emission and safety standards in such a mature market.

A report from the Economist magazine's Economic Intelligence Unit said mainland producers would gain a foothold in the US and western Europe with their low-cost cars but face questions about vehicle quality.

The report said western consumers were used to a low-cost strategy from experience with Japanese and South Korean carmakers. But the mainland's success would ultimately depend on how it built brand reputation.

Five mainland carmakers - Geely Holding Group, Zhongxing Auto, Changfeng Motor Group, BYD Auto and Li Shi Guang Ming Auto Design - will participate in the Detroit Car Show this year. Industry watchers see this as a way for mainland carmakers to gain exposure to the US and western European markets.

Shenyang-based Brilliance China Automotive Holdings will start exporting its Zhonghua sedans to Germany this year. It plans to sell 158,000 vehicles with its partner HSO Motors Europe over the next three years.

Chery Automobile and Geely are expected to announce plans for exports of low-priced, small economy cars to the US by next year.

Chery signed a co-operation deal with Chrysler last year, with Chrysler to distribute the Chery-made models in the North American market.

Geely chairman Li Shufu has been reluctant to disclose the company's detailed plans for exporting to developed countries.

A Fitch annual report on the vehicle industry said most mainland carmakers would continue to focus on developing markets.

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