Stuttgart: Luxury carmaker Bayerische Motoren Werke (BMW) plans to start a car-leasing business in China in 2012 to help boost its presence in the fast-growing auto market.
"Based on our experience in other markets, we see great potential for development" in car leasing in China despite limited demand at the moment, Friedrich Eichiner, the member of BMW's management board responsible for finance, said in Beijing yesterday.
A leasing business and a new finance arm, announced earlier this week, may help the Munich-based automaker increase sales in China's fast-growing luxury sector.
Sales of luxury cars in the nation may grow at almost double the industry pace of 20 per cent to reach 530,000 units this year and 1.1 million by 2015, according to researcher J.D. Power & Associates.
BMW said on Tuesday it won approval from China Banking Regulatory Commission to set up an automotive finance company.
BMW Automotive Fin-ance China Co. is 58 per cent held by the European carmaker, while BMW Brilliance Automotive Holdings Ltd, BMW's Chinese joint venture, owns 42 per cent, Wu Xiaoan, the partnership's chairman, said yesterday.
The finance unit is expected to start operations before the end of this year, Kirk Cordill, its chief executive officer, said.
BMW expects the new car-finance arm to account for less than 10 per cent of its sales in China next year, similar to the ratio currently achieved through an agreement with Shenzhen Development Bank, Cordill said.