General Motors has rolled out the first car under its newly created Baojun brand in China.

The move is seen as a direct challenge to indigenous carmakers which have generally cornered the market in smaller cities and townships with affordable models.

The Baojun 630, priced at between CNY62,800 and CNY73,800  (US$9,758-$11,467), will target consumers in China’s second- and third-tier cities, GM said in a statement.

It will also be available in first-tier and fourth-tier cities gradually, it said, adding over 120 sales outlets for Baojun are now opening for business nationwide.

GM, which also sells Buick and Cadillac models in China, has also been stepping up its presence in smaller, inland cities which are quickly replacing coastal cities as the major industry growth driver.

GM and partner SAIC Motor started to work on the new passenger car brand even before the launch of the new Chevrolet Sail, the cheapest foreign brand in China.

The Baojun 630, with a 1.5 litre engine, is the first of a series of models the partners plan to launch in the coming years, combining GM’s technologies and China’s low cost manufacturing.