Europe to Test-Drive Chinese SUV

This is particularly pronounced in the auto industry. China is home to more than 100 automakers with a collective capacity to produce about 6 million cars a year, according to the China Association of Automobile Manufacturers. Yet sales last year of Chinese-made cars totaled only 2.3 million, according to state media. An ongoing $25 billion expansion is expected to exacerbate the glut, nearly doubling existing capacity by 2007. Meanwhile, sales growth has slowed from 76 percent in 2003 -- fueled by easy credit terms that have produced many bad loans -- to 15 percent last year, according to state statistics. Prices have fallen between 5 and 14 percent every year since 2000, according to Frost & Sullivan. The popular VW Santana has dropped in price from about $21,000 in 2000 to less than $9,000 today.

"The Chinese government is pushing big Chinese manufacturers to build their own brands and penetrate new markets overseas," said Jia Xinguang, a senior analyst at the Beijing Institute for Automobile Industry Research. "Automakers have to go overseas to find markets for their overproduction."

Landwind is a piece of the Jiangling Motors Co. Group, a state-owned company set up in Nanchang in 1963 to repair trucks and buses. Recently, Jiangling has profited from the boom in passenger cars. Launched three years ago, the Landwind was among the first SUVs in China.

"We knew that in America SUVs were increasingly popular," said Liang Bo, director of marketing and sales at Jiangling Motors Import & Export Co. Ltd. "We figured that as living standards rose, people would want this kind of vehicle."

The Landwind was born like many Chinese products: Jiangling purchased all the SUV models it could, then took them apart and studied them. "Basically, we bought them all," Liang said.

In 2001, the company built a new factory, aided by tax breaks and cheap land from the local government. The next year, it made 200 SUVs: some front-wheel drive and some four-wheel. The following year, Landwind sold 2,800. This year's target is 21,000.

Despite that success, Landwind has been hurt by the national glut, chopping the price of its most popular vehicle to $20,000 from about $22,500. By late 2003, Liang was in the middle of researching export possibilities.

"We have to be stable and show very good performance in Europe, and then we will go to the United States," Liang said. "We want to be a global brand. It might take a long time, but we're starting now."

But how? Who would distribute the cars? How would they meet European emissions standards? Landwind lacked the technology to comply.

Bijvelds seems an unlikely vessel for China's hopes of entering the European market. Only 27, he was raised in this town of 6,000 in flat pasturelands some 60 miles south of Amsterdam. But his parents were car dealers, and recently he has run his own import-export company, bringing inexpensive Nissans to Holland from Italy.

His China venture began in April 2004, when a friend who had invested in a Chinese helicopter factory brought him along on a visit to see the Landwind factory in Nanchang, a poor and gritty city just south of the Yangtze River in the Jiangxi province. Bijvelds liked what he saw, a tidy factory of 1,000 workers with the capacity to make 50,000 vehicles a year. Its production line included robotics from Japan, assembly equipment from Britain and a paint system from Germany. "It was very clean and efficient," he said.

When he drove the vehicle, he was impressed. Big and boxy, it did not corner like a sports car nor accelerate with power. But for Europeans wanting to tow a boat or looking for a roomy vehicle, this car could challenge Korean models such as the Hyundai Tucson and the Kia Sorrento. It had air conditioning, electronic controls and aluminum wheels -- and it was relatively fuel efficient.