AUTOSHOW-UPDATE 1-BMW building 2nd China plant with partner

* BMW building second China plant with partner Brilliance
* Brilliance aims for bigger share of sales from exports
* Brilliance not giving up on European market

(Adds quotes, details)
By Fang Yan and Jacqueline Wong
SHANGHAI, April 20 (Reuters) - BMW and its partner
Brilliance Auto are building their second manufacturing plant in
China, where demand for luxury sedans remains solid despite a
steep downturn in mature markets, a senior official at the
Chinese automaker said on Monday.
The BMW-Brilliance venture plans to increase annual capacity
by 75,000 to 80,000 units by the second half of next year, up
from its capacity of 30,000 at end-2008, Yufei Wan, the chief of
Brilliance's international trade arm, told reporters on the
sidelines of the Shanghai Auto Show.
BMW issued a statement, however, saying no decision had been
made on a second plant.
Wan did not specify what BMW models would be made at the
plant and acknowledged some details were not yet finalised.
"The specific amount of the investment has yet to be approved
by the board, but a plant like this would cost 1.5 billion to 2.0
billion yuan ($220-293 million)," he said.
BMW, the world's largest premium car maker, currently
manufactures BMW 3 series and 5 series sedans at a plant in the
northeastern Chinese city of Shenyang. It sold 16,580 cars in
China in the first quarter, up 13.8 percent from a year earlier,
company data showed.

EXPORTS
Brilliance, which makes sedans, vans and light trucks, aims
to be producing 500,000 to 800,000 vehicles per year in three to
five years, Wan said.
That is an apparent step back from an annual sales target of
1 million units in 2012, presented by Brilliance Chairman Qi
Yumin in April 2008. [nSHA351094]
The company sold 285,242 vehicles in 2008, ranking eighth
among Chinese automakers, data from the country's official auto
association showed.
Brilliance, parent of Brilliance China Automotive Holdings
<1114.HK>, has been shipping its BS6 and BS4 mid-sized sedans,
developed in-house, to Europe since 2007. Both models scored
poorly in initial crash tests although improvements were
subsequently made to the BS6 model.
Wan blamed the poor test results partly on changing standards
in Germany.
"We have run into some obstacles there and we are working
actively to adapt to the new standards. We are not giving up on
the European market," he said, adding that roughly 4,000
Brilliance sedans had been sold there so far.
Brilliance, which is selling in more than 60 countries,
mostly in emerging markets, aims to be generating roughly
one-fifth of its vehicle sales from exports in the next three to
five years, up from 7.7 percent in 2008. Most of those sales will
be coming from developing markets, he said.
The firm is also developing batteries for clean-energy
automobiles jointly with Johnson Controls Inc , he added.
($1=6.832 Yuan)
(Editing by Edmund Klamann)
((edmund.klamann@reuters.com; +86 21 6104 1799; Reuters
Messaging: edmund.klamann.reuters.com@reuters.net))
((If you have a query or comment on this story, send an email to
news.feedback.asia@thomsonreuters.com)
Keywords: AUTOSHOW/BMW BRILLIANCE

(C) Reuters 2009. All rights reserved. Republication or redistribution of
Reuters content, including by caching, framing or similar means, is expressly
prohibited without the prior written consent of Reuters. Reuters and the Reuters
sphere logo are registered trademarks and trademarks of the Reuters group of
companies around the world.

nSHA344162