AUTOSHOW-China's Great Wall to focus on small cars for growth

BEIJING, April 18 (Reuters) - Chinese sport utility vehicle maker Great Wall Motor Co (2333.HK) said it will shift its focus to developing smaller cars to grow in its domestic market, in light of rising fuel costs and changing consumer preferences.

"The trend toward small vehicles is global," President Wang Fengying said at an industry conference on Friday, ahead of the Beijing Auto Show.

"Small cars hold an important share of the market in Europe and Japan, and China is also a big market. We can't reach our annual sales goal -- even if we have 70 percent of the pickup market -- without smaller cars," she said, speaking through a translator.

Great Wall, with annual production of about 400,000 vehicles, primarily builds SUVs and pickup trucks, and has a goal of raising that to 500,000 units in the near term.

"Although it may not be very profitable, we believe we can win in the competition by having a variety of products," Wang said.

Great Wall eventually wanted to lead the domestic minicar market, and has plans to add more products to its line-up of six models in the segment, she added.

That is an ambitious goal in a country already packed with small cars from national and foreign brands alike.

Wang said Great Wall's priority was on improving product quality not just lowering prices, fueled by plans to expand its exports to Europe.

Other Chinese small-car brands such Chery and Geely also have export ambitions to such mature markets but have given no concrete timeline.

Great Wall began exporting pickup trucks first to the Middle East, and now ships to more than 100 countries and regions.

It shipped its first batch of Hover SUVs to Italy in 2006, with sales estimated to rise to 5,000 units this year. (For FACTBOX on Chinese automakers and their foreign partnerships, click [ID:nSHA169575]) (By Chang-Ran Kim; Editing by Lincoln Feast)