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Cheapies from China

New cars as cheap as $10,990 are about to zoom into the Australian market.

Chinese models will be leading the way and are expected to shake up the local motoring scene, the way Korean cars did in the 1990s and Japanese makes in the 1970s.

Budget-priced vehicles are also coming from India, Italy, Slovakia and the Czech Republic.

China has hundreds of car makers with names such as Chery, Geely, Great Wall Motors, Nanjing, Hafei, Zhongxing, Zhonghua, Brilliance China and Shanghai Automotive.

However, some of the Chinese models have fared poorly in European crash testing.

The Brilliance BS6 sedan got only one star out of a possible five when tested last month, while an SUV Landwind made by Jiangling Motors scored a zero.

It was the worst result in 20 years of testing.

Details of what Chinese makes will be released here are being kept secret by executives of the companies which will join the invasion.

The smaller Chinese cars are expected to start at $10,990.

Industry observers agree and expect the Chinese strategy will be for cars to be priced under their Korean equivalents, which have recently been as low as $12,990 in order to get a footing in the crowded market.

The arrival of the first Chinese-brand cars is being handled by Ateco Automotive, an independent importer which already brings in Alfa Romeo, Fiat, Citroen, Ferrari and Maserati.

The deal is being masterminded by Ric Hull, the executive involved in establishing all the major Korean brands including Hyundai, Daewoo and Kia in Australia.

Ateco spokesman Edward Rowe said Chinese cars could reach Australian showrooms by mid-2008. “We're still working on it. We're talking to specific companies but there is a confidentiality agreement in place,” he said.

Rowe says the plan was to start Chinese imports with small cars, then increase the range. “Ultimately there will be a full range of cars and commercial vehicles,” he said.

Chrysler has made a deal with Chery for a Chinese-made small car to be exported to the US and Canada.

An Indian brand Mahindra went on sale in NSW last month and plans to open a Queensland dealer network by September.

A spokeswoman said: “Talks are under way with a number of dealers. Queensland will be the next market for Mahindra, it's imminent.”

The brand is starting with the Pik-Up utility, diesel-engined “one-tonners” from $23,990 but the spokeswoman said they were 'exploring their options' to sell more models.

“There are other opportunities there, but we're concentrating on getting launched first.”

Czech-made Skoda cars last sold here 25 years ago and will return in October, with a five-seat mini-people-mover called the Roomster, and the Octavia lift-back.

Skoda head Matthew Wiesner said prices would be set against their Japanese equivalents, rather than at traditional European levels.