German car manufacturers are outperforming the market in China in the first three months of the year.

According to data from the Verband der Automobilindustrie (VDA), German manufacturers increased their sales by 36%, compared to overall market growth of 22%.

Speaking at the Auto China 2008 motor show in Beijing, VDA president Matthias Wissmann said that every fifth car registered in China now has a German badge on it.

German suppliers are also doing well in the country, employing more than 47,000 people there. He said that there are opportunities for German companies to benefit from the growing market in China and rising levels of quality. The VDA has run a quality management centre in Beijing for the last two years issuing supplier qualifications and giving training.

Wissmann praised government efforts to better protect intellectual property rights and said this would help with the technology transfer process.

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Highlighting the importance of the Chinese market, Audi and Mercedes-Benz have chosen the Beijing show for the global launch of their new SUVs. Audi is launching the Q5 and Mercedes-Benz is launching the GLK. This is a response to a doubling of the market for SUVs in the last year.

Volkswagen is launching two new models at the show, the new Bora and the Lavida, both developed specifically for the Chinese market. CEO Martin Winterkorn said he expects the brand to sell more than a million cars this year, up from 910,000 in 2007. He said 1.5m sales a year would not be unrealistic within the next two years.

Premium car makers are expecting big things from China. According to a study by the IFA Institut, reported by German press agency dpa, the luxury car market is expected to grow to 15% of the market by 2015, equivalent to around 2.5m cars. Audi is currently leader of the premium car segment, with over 100,000 sales, but it will have to fight off growing ambitions from Daimler and BMW in this area.

BMW sold around 50,000 cars in China in 2007 and Daimler sold 27,000. BMW is launching the 1-series and the new X6 crossover.

Porsche also has strong growth targets for China. It sold 4,200 cars in the country in 2007, a doubling of sales compared to the previous year. It is planning to increase the number of sales centres in the country to 30 this year, up from 19 now. Longer term it hopes to have 40 dealers in the country.

Porsche head of sales Klaus Berning said that 10-15% of the planned 20,000 Panameras that will be produced each year from 2009 are destined for China.