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SAIC to sell MG cars in EU by year end

SHANGHAI (Reuters) - SAIC Motor Corp, China’s biggest automaker, plans to sell its UK-made MG cars in Europe at the end of the year as it moves to revive the British vintage brand it took over three years ago.

A MG sports car is seen at MG Rover's Longbridge factory in Birmingham, central England, May 29, 2007 file photo. REUTERS/Darren Staples

SAIC, which has had initial success selling its own-brand cars domestically, has joined the rush of Chinese automakers, including Geely Automobile Holdings, hoping to make a name globally.

Assembly of MG-series models, including the MG 6, would begin at its Longbridge plant in England late this year, SAIC chairman Hu Maoyuan told Reuters on the sidelines of Shanghai’s annual People’s Political Consultative Conference.

“We want to get our U.K. plant up and running,” Hu said. “MG models will not only be sold in Britain but also in other European countries through its existing dealership networks.

SAIC, a General Motors and Volkswagen partner in China, became the owner of MG Rover’s 10,000-unit Longbridge plant in Birmingham, central England in 2007, after a merger with its much smaller peer, Nanjing Automobile Group.

It launched its first self-developed car, the Roewe 750, based on acquired technologies, in March of that year, followed by the Roewe 550 and MG 6 models, popular with young, elite professionals.

One option for SAIC is to make complete knocked down (CKD) kits for the models in China and have them assembled in the U.K.-plant, Hu said.

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“The idea is to take advantage of the existing MG sales network in Europe as well as the cost advantage in China,” Hu said.

China was a rare bright spot in 2009 amid the sharp global industry downturn thanks to Beijing’s stimulus measures, including aggressive tax incentives, for small cars.

That year a trio of obscure Chinese names -- Geely, Beijing Automotive Industry Holding Co (BAIC) and Sichuan Tengzhong Heavy Industrial -- made moves to buy all or part of storied global brands Volvo, Saab and Hummer.

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BAIC, the China partner of Hyundai Motor Co and Daimler AG, had said it wants to use the acquired Saab platforms to make its first own-brand car.

Geely, expected to close a deal to take over Ford Motor’s car unit in the next few months, hopes to raise its profile at home and overseas.

SAIC is one of the few Chinese automakers that has already gained a foothold in the lucrative medium-to-higher end domestic auto market now dominated by GM, Toyota Motor and the likes.

The Shanghai-based automaker aims to double the sales of its own-brand cars to 180,000 units this year after it far exceeded its sales target in 2009, SAIC President Chen Hong said in November.

Annual sales could rise to 500,000 units in the foreseeable future despite the challenges of locally made foreign brands, Chen said.

SAIC, however, has not set a sales target in the United Kingdom, where the distinctive MG badge dates back to about 1925 and still has its die-hard fan base.

“We have no sales target in the U.K. or other European countries. MG is pretty well known there though,” said Hu.

Reporting by Fang Yan and Ken Wills; Editing by Dean Yates

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