With more new multifunctional midsize passenger vehicle models being launched at the middle class, competition is expected to heat up between mainland, foreign-funded and joint venture automakers in 2007.

Competition over the passenger vehicle market has extended from the economy sedan to the mid-range sedan, and in this atmosphere Volkswagen's plans to localize production of its Magotan have gotten a great deal of attention. However, according to the China Automotive Industry Association's statistics, Guangzhou Toyota's Camry tops all new basic sedan brands, with 61,300 units sold in 2006.  Since Camry's launch in June of 2006, its sales climbed rapidly, with an average monthly sales volume at 10,000 units.

Automakers view mid-size and high-end sedans as their main source of profitability. However, 2006 saw a series of new launches targeting the mid-range market segment.  Besides Guangzhou Toyota's launch of the Camry, FAW-Volkswagen launched its Sagitar, and Dongfeng Citroen introduced the Triomphe, while Dongfeng Nissan launched the Sylphy.  Beijing Hyundai introduced the NF, and Soueast Mitsubishi its Galant.  FAW's own patented Benteng, and Shanghai Automotive's own patented Roewe also joined the crowd, making competition over the midsize vehicle market even fiercer.

However, automakers don't yet seem as anxious to launch new midsize vehicle models in 2007.  The first move comes from FAW-Volkswagen, which plans to introduce its Magotan in China early this year.  With its origins in the fifth-generation Passat that won over Chinese consumers, the luxurious, sporty and progressive Magotan is expected to pose a serious challenge for the top position as China's bestselling midsize sedan.  The new model is an important part of FAW-Volkswagon's strategy to set the company on a path towards a successful future in China.