Luxury dazzles, China beckons at Geneva motor show

(Geneva Motor Show)

Major car makers were set to dazzle visitors to the Geneva motor show over the coming week with a touch of luxury, but China and emerging markets will be firmly in mind at the European showcase.

The show in the wealthy Swiss city, which opens to an expected 700,000 paying visitors on March 3 to 13, is traditionally neutral ground for the industry, attracting 260 exhibitors from 31 countries.

When top executives preview the event from Tuesday, car makers are again set to whip up an appetite for the big, powerful and glitzy, even if the engine under the bonnet seeks greener or thriftier credentials.

"Last year the average size of cars increased in the United States," noted analyst Juergen Pieper of German bank Metzler.

Italian sports car maker Ferrari's new FF will be premiered in Geneva, with four seats instead of the more common two and the reassuring grip of four wheel drive.

Ferrari's Volkswagen-owned Italian rival Lamborghini is also due to unveil its most powerful car, the edgy and low slung Aventador - reportedly with nearly 700 horsepower - while Aston Martin also presents the new Virage.

Rolls Royce is hinting at more stately green credentials with a first outing for an experimental plug-in electric motor in its 102EX limousine, allowing for an overnight recharge after a daily whirr on the streets.

Even the diminutive and trendy Fiat Cinquecento runabout will be chintzed up with a "Gucci" version trimmed by the luxury fashion brand.

But while Europeans get to make them and admire them first, the place where they are most likely to sell is fast growing China, analysts said.

In 2009, the still nascent Chinese market overtook the United States as the world's biggest car buying nation, with much more in store and adding new growth on top of existing markets.

"In 2010, the growth in sales of luxury cars was stronger than that of other segments," said Pieper.

"It's above all a trend in emerging countries, especially China," he explained.

Carlos Da Silva, senior market analyst at consultancy Global Insight, said: "As far as luxury cars are concerned, growth depends on the health of Chinese, Russian and other emerging markets."

Volkswagen Group's premium brand Audi started the year with monthly sales growth of 32 percent in China - with 22,196 cars sold in January, more than 23 percent of worldwide sales - as the German brand laid claim to its "best ever January".

"For the first time in 2010, Audi sold more cars in China than its home German market," Da Silva pointed out, while also highlighting a recovery in the United States.

Last Friday, Italian auto giant Fiat outlined plans to produce 300,000 cars per year in Russia, with its sights set on expansion in emerging markets following its merger with US auto group Chrysler.

By contrast, the European market was dubbed "boring" by analysts who expect little more than lacklustre sales this year.

New passenger car registrations fell by 1.4 percent year-on-year in January, as sales remained depressed outside the big German and French markets, according to the European Automobile Manufacturers Association (ACEA).

Technological gadgets abound, however, with a new trend for "the Internet connection in the car," said Stefan Bratzel, of the Automotive Center at the German Fachhochschule der Wirtschaft (FHDW).

The Audi A6 saloon premiered in Geneva will include an optional online navigation and travel information service on its dashboard screen.

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