German-US automaker DaimlerChrysler said it was planning a new sales offensive in China by vastly expanding its dealer network, marking a fresh attempt to shore up its Asian operations.

The Frankfurter Allgemeine Sonntagszeitung (FASZ) said the company would boost the number of dealers of its luxury brand Mercedes Benz to 217 in 68 Chinese cities by 2012, up from 33 dealers in 23 cities in 2002.

DaimlerChrysler spokesman Toni Melfi said the company would not comment on specific figures cited in the report but acknowledged it had major plans in China.

"I cannot confirm the exact numbers but we do plan to greatly expand the dealer network and expand our metropolis strategy to Chinese cities," Melfi said.

DaimlerChrysler also aims to use low-interest loans for dealers and customers to speed up sales.

"We will bolster the sales of DaimlerChrysler brands with financial services," management board member Ruediger Grube told the FASZ.

Grube said the company was also trying to form a joint venture for trucks and buses, adding that it was the "first company worldwide" to deliver energy-efficient buses running on fuel cells to China.

"There are already three operating in Beijing," he said.

Grube said that beyond China, DaimlerChrysler was also eyeing the Indian market for an expansion drive.

He said that in the "medium term" Daimler would sell three million cars per year there and noted that Mercedes already claimed 60 percent of the market share for luxury automobiles.

"That shows we are on the right track. And we will continue to strengthen our investments there," he said.

DaimlerChrysler's Asia strategy was called into question in April when it decided to pull the plug on further financing for its Japanese partner Mitsubishi, which is posting heavy losses.

The move, which came as a surprise, was widely interpreted as a setback for the company's ambitious international expansion campaign.

Source: agencies