China Aims for Slice of Us Car Market

Cut-price Chinese cars will soon go on sale in the United States, realising long-held fears of the American auto industry.

Distributor Visionary Vehicles has signed a deal with China's Chery Automotive to import the company's cars into the US, promising prices 30% lower than comparable models on the market.

Malcolm Bricklin, the chief executive of Visionary, said he aims to introduce five models in the US in 2007. He is looking for 250 US dealers and hopes to sell 250,000 vehicles in the first year and 1m within five years.

Mr Bricklin introduced Subaru into the US from Japan. He also ran a failed venture to bring Yugoslavia's Yugo to America in the early 1990s.

The agreement is the first large-scale attempt to introduce Chinese-made cars into the home of the auto industry.

The US business has long been wary of China with its far lower labour costs. Chery is the country's eighth-largest carmaker and sold 90,000 vehicles in its home market last year.

In an effort to assuage any concerns among US consumers about quality or safety, the company is offering a 10-year, 100,000-mile warranty.

Models will include a compact sedan, a mid-size sedan and a sports utility vehicle.