Car makers' Geneva business battle

Chrysler's soft-top PT

GENEVA, Switzerland -- BMW, the German luxury car maker, plans to steal the limelight at this week's Geneva Motor Show with the unveiling of the CS1 concept car.

The CS1, BMW's long-awaited new 1-series, is expected to be launched in 2004 and should herald its assault on Ford's Focus and Volkswagen's Golf models.

Priced at about $22,000, the midrange car will slot between the Mini and the money spinning 3-series. The CS1 convertible will include the new 7-series "mouse" that can be used to access some of the cars control functions.

Among the array of other releases at the 72nd Geneva Motor Show, executives are hoping to stimulate consumer interest amid some uncertainty surrounding the current global economic climate.

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European demand for new cars is expected to slide by 5 percent this year and the recent strength of the U.S. market has caused concerns, with many commentators saying incentives offered by U.S. car makers may have only brought forward demand.

General Motors, the world's biggest automaker, offered some hope for the industry, raising its earnings outlook and production plans for the year. It said the move was in reaction to stronger-than-expected auto sales and signs of U.S. economic recovery.

Last Friday's auto sales figures for February, also raised expectations that the industry could be over the worst of a downturn.

But GM will be hoping its European divisions, Vauxhall and Adam Opel, can revive their flagging fortunes with the unveiling of the new Vectra model, which has suffered from sales rep image.

DaimlerChrysler, the world's No. 3 car maker, will be showing off its new Mercedes E-Class but like BMW its hopes to drum up interest in its own convertible, the upright retro four-door hatchback Chrysler PT. Chrysler has sold 157,000 Cruisers in the U.S. and about 31,000 elsewhere. The convertible will be built at the company's vehicle assembly plant in Toluca, Mexico.

Daimler will also get a look at Volkswagen's attempt to challenge its exclusive Mercedes Benz S-Class. Volkswagen, Europe's biggest car maker, will showcase its new Phaeton, a huge limousine in its bid to take the brand image upmarket. But VW's critics are quick to point out it will just be competing against its own Audi luxury car business.

For the first time, Mercedes ultra-luxurious Maybach, which has a 12-cylinder engine and optional beds in the back, will be on display and is expected to retail for about £200,000. It will compete against the BMW's Rolls-Royce Marques.

Another car aimed at the top end of the market is Porche's new sport utility vehicle, the Cayenne, and Ferrari will display the 575M Maranello featuring a Formula One gearbox.