Mercedes-Benz will build 40 maintenance service centres in China by the end of
2005, the year before the country slashes car import tariff from the current 80
to 100 percent to 25 percent, China Daily reported.

In addition to the existing 23 centres, Mercedes-Benz China president Karlheinz
Michel said according to the report, two more will soon be established in Chengdu
and Chongqing, two important cities in China’s western hinterland.

The company launched the Guangzhou Star Mercedes-Benz showroom last week, the
first of its kind in the gateway city to South China’s Guangdong province.

Last week, the Chinese distributor also launched its new C-Class Sports Coupe.

"The showroom is a benchmark for our customer service and our continuing
commitment to China," Michel said.

With a market capacity of 65,000 in China, Mercedes-Benz is one of the three
foreign giants that now dominate the imported luxury car market. Its key rivals
are BMW and Volvo.

China Daily said that, with service increasingly becoming the key aspect of
competition between the three, Mercedes-Benz has begun imposing internationalised
and standardised management over its maintenance centres across China.

Increased competition between imported luxury car makers, begun last year,
has become more evident this year, the report said.

The first V6 engine Honda Accord 3.0 was made on April 10 and, on April 18,
Volvo’s S60 luxury sedan was launched.

China Daily said that as BMW enters the final examination and approval stages
of its Chinese joint venture project, it is increasing the number of local sales
and service agents from 20 to 35.