China car maker plans buys, moves up market

(Adds details, executive's comments)

By Alison Leung

HONG KONG, July 13 (Reuters) - Geely Automobile Holdings Ltd. (0175.HK: Quote, Profile, Research, Stock Buzz) plans to take over four car plants worth nearly US$500 million and set up another, as the ambitious Chinese firm expands, streamlines its structure and revamps its product slate.

Geely wants to shed its image as a maker of cheap cars by investing heavily in research. The firm hired former Chrysler executive Frank Zhao last year to head up a research effort it hopes would propel its nascent drive to sell cars abroad.

Geely, a private firm founded by entrepreneur Li Shufu that sells some of the country's cheapest automobiles, has 15 new models in the pipeline, executive director Lawrence Ang said on Friday.

And the firm -- which is in discussions to set up assembly plants across the Americas, Europe and Africa -- is working on an engine that would help it meet the latest European emissions standards.

"We started from the production of cheap and simple small cars and now we want to enter a phase of technological leadership and good quality," Li told reporters.

"Our development strategy is now in a transitional phase," he added.