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Chinese autos are mainly sold to emerging markets in the Middle East, Latin America and Russia. However, many in the industry have ambitious plans for more developed markets as well.

DaimlerChrysler's US arm said last week it was joining forces with China's Chery Automotive to build small cars in China that will then be sold in the United States and around the world.

A customer looks at the engine of a Chery QQ car at a dealership of China's largest car exporter, Chery Automobile in Shanghai. China plans stricter export rules to ensure that only big and credible auto makers take part in the nation's push to become a major power in the global vehicle market. [AFP]

Brilliance China Automotive Holdings, one of the nation's top auto makers, announced in November that it planned to ship 158,000 cars to Europe over the next five years.

It marked the biggest ever single export deal that any Chinese car manufacturer had carried out using its own brand, Brilliance China said.

The urge to export is partly linked to the problem of overcapacity, resulting from years of expensive investment in new plants that has outpaced even China's booming demand for cars, the lifestyle symbol of an emerging middle class.

China said late last month it would raise the threshold for investment in new auto projects in a bid to rein in capacity.

Auto makers that wish to add new plants must prove that they have been able to sell at least 80 percent of their annual production capacity the previous year, according to earlier reports in the state media.

The country's production capacity reached eight million units by July 1, 2005 while demand was only 71.5 percent of capacity last year, data from the National Development and Reform Commission showed.

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