Range Rover

Chinese cars are coming to Australia, but they won't necessarily undercut Korean cars on price.

Automotive importer Ateco has confirmed it is planning to launch the Chery brand in the first quarter of next year.

Ateco managing director Ric Hull says the brand will be looking to establish itself as the "best value" brand in the market.

"We haven't finalised pricing with Chery yet but we would expect to undercut (the Koreans). It might not be on the sticker price, but on pricing and equipment levels we will be ahead of the Koreans," he says.

The brand will start with three vehicles; a light car, small car and compact four-wheel-drive. Possible models include the A1 light car, the A5 small car and the Tiggo 3 four-wheel-drive.

Mr Hull wouldn't confirm exact model line-up details, but said the three would be soon followed by more vehicles from the Chinese manufacturer's extensive line-up, which currently numbers 38 different models.

Chery is the largest of China's 20 independent manufacturers.

Mr Hull acknowledges it will be a battle to establish the brand locally.

"Obviously, the current perception of Chinese cars is that they will be cheap and sub-standard but we're confident we can turn that around," he says.

He also dismisses claims that the cars will offer sub-par safety. "The vehicles we import will comply with all ADRs (Australian Design Rules), including the comprehensive and severe crash testing requirements," he says.

Two of Chery's vehicles recorded dismal crash results when tested by the independent Euro NCAP crash laboratory.

The Chery import deal has been three years in the making and Mr Hull says the company already has close to a hundred dealers who have expressed an interest in operating a franchise

Ateco was responsible for setting up the local operation of Korean car maker Kia but was dropped in 2005 when the Kia set up its own operation.

Mr Hull denies revenge will be motivation for the new franchise.

"We enjoyed representing Kia, but we also learned with Kia that having a volume selling brand in our stable was good business," he says.

Chery will start with a network of roughly 75 dealers, but that figure will grow very quickly in the first year, Hull says.

Volume targets haven't yet been set but Hull says the franchise will want to sell "several thousand cars".

The range will initially be petrol-only, but diesel vehicles are also on the wish list.

The Tiggo 3 is sold in China with four different petrol engines, and is also available in Europe - where it's assembled at a plant in Naples, with a Fiat-derived 1.9 litre turbo diesel engine.

In China, the Tiggo 3 is powered by an 80kW 1.6 litre engine and a 97kW 1.8 litre unit. There's also the option of a 2.4 litre, Mistubishi-sourced 95kW engine.

The five-door A1 hatchback is about the same size as the Toyota Yaris and powered by either a 1.1 litre, 50kW engine or a 1.3 litre, 60kW power plant.