Developing Markets a Bright Spot for Automakers

(MoneyWatch)  As mature markets like the United States and Western Europe market have cratered, luxury brands like Porsche and Rolls-Royce are turning more and more to developing markets in Asia, India, and in Central and Eastern Europe.

So are less lofty brands like Buick, which sells far more cars in China than it does in the United States. And while Americans have turned their backs on Hummer, and General Motors is trying to sell it off, demand for macho gas-guzzlers is strong in Russia and the Middle East.

"In the last five years, the markets in Central and Eastern Europe have evolved at a breathtaking pace. Porsche has been able to more than quadruple the number of cars it sells there," Porsche said in a written statement, announcing the creation last month of a new regional headquarters in Prague, in the Czech Republic.

Porsche sold about 3,200 vehicles in Central and Eastern Europe in the fiscal year ended Sept. 30, an increase of about 6 percent. The Cayenne SUV is in particularly high demand, the company said.

The new regional office in Prague will oversee sales, service, pubic relations and marketing activities of 34 Porsche dealerships in 23 countries, adjoining the region handled by Porsche Russia. Poland and Turkey are also important individual markets for Porsche, the company said.

Meanwhile, Rolls-Royce on Oct. 31 opened its seventh showroom in China, in the city of Shenzhen, in southern China. That's a lot, considering there were none in mainland China before 2001, and that Rolls-Royce has fewer than 90 showrooms worldwide.

In September, a Rolls-Royce dealership opened in Hangzhou. The company expects another to open in Ningbo in early 2009, said Jenny Zheng, general manager for Greater China, for Rolls-Royce Motor Cars. Additional dealerships are in Beijing, Chengdu, Guangzhou, Hong Kong and Shanghai.

The company said China has overtaken Japan as the No. 3 Rolls-Royce market worldwide, after the United States and the United Kingdom.