Daimler AG will triple production capacity at a Beijing venture on rising sales and growing demand for a new Mercedes-Benz E-Class sedan, Bloomberg reported today. Mercedes-Benz is seeking to surpass BMW in China's luxury-car market.
Beijing Benz-DaimlerChrysler Automotive Co (BBDC), Daimler's car venture with Beijing Automotive Industry Holding Corp (BAIC), will reach an annual output of 100,000 vehicles. The venture's former Chrysler hall is now used for Mercedes C-Class and E-Class cars after Chrysler quit BBDC in late 2008.

Last month, Mercedes' China sales surged 224% from a year earlier to 8,700 units. Sales in the first 11 months grew 68% and the full-year tally will likely pass 65,000 vehicles. China's demand for luxury cars helped Daimler achieve a new sales record in this fastest-growing auto market for every month of this year.

Daimler's Mercedes-Benz brand sales are projected to grow more than 60% year-on-year in China with appetite for the flagship E-class and S-Class limousines expected to be a key driver of sales going forward.

Mercedes will overtake BMW in China "soon," Daimler CEO Dieter Zetsche said last month. BMW is the second-biggest luxury-car maker in China behind Volkswagen's Audi.

Beijing Auto has also agreed to take over Fujian Motor's 40% stake in Fujian Daimler, a southeast China-based commercial vehicle venture with Daimler AG.