BMW has affirmed the hearsays that it will construct front-wheel drive cars. Dr. Norbert Reithofer, Chairman of the Board of Management of BMW announced this at the Annual Accounts Press Conference for 2010. He stated that “The small car segment is expected to grow further. And we will take advantage of this opportunity. We are exploring the possibility of developing a joint architecture for the front and four-wheel drive systems of these cars. In other words: There will be front-wheel drive BMWs in the smaller vehicle classes in the future. Heresy, BMW fans – We wouldn’t worry too much – there seems little chance that BMW will make a wholesale switch from powering the rear wheels to the fronts, especially for its mainstream models like the 3 Series, 5 Series and 7 Series – but the addition of a FWD chassis will make it easier for the automaker to share platforms with other companies and to reduce [its] fleet’s carbon-emissions worldwide by at least another 25 percent between 2008 and 2020.”

Dr. Reithofer stated further that “We consider carbon fiber a cutting-edge material for the auto industry. Our efforts will make sustainable mobility possible in urban environments.”

John Zeng, an IHS Global Insight analyst in Shanghai remarked that “If Volvo chooses China as its second home market, that’s probably going to trigger a price war in the premium segment.” He also stated that “cars can sell for 50 percent more in China than in the U.S.”

Ingolstadt, the Germany-based Audi signifies to oppose its leadership position and has programs to sell 200,000 cars in China in 2010 which is up from 159,000 last year. BMW sold 90,500 vehicles in the country in 2009.

With so much at chance, all three auto manufacturers program to broaden local production. BMW is elaborating its present Chinese factory and constructing a second one at a cost of 560 million euros to more than twice its capacity and build around 100,000 vehicles. Daimler, the world’s second-largest luxury auto manufacturer, at present has capability to build 100,000 C- and E-Class models at a Chinese plant. Daimler Chief Executive Officer Dieter Zetsche said last week “The potential of the Chinese market remains enormous, and our targets are correspondingly ambitious.”

John Bonnell, who is the director of Asia-Pacific forecasting for J.D. Power & Associates and located in Bangkok, said “We expect competition to pressure prices should the market slow.”