The Beijing municipal government is to fully support a bid by Beijing Automotive Industry Holding Corp for Ford's Volvo car unit if the Chinese auto maker fails in its quest for General Motors' Opel, sources said yesterday.

In a move that surprised some of its domestic peers, Beijing Auto, a second-tier player in China, submitted its final bid for GM's Opel and Vauxhall brand recently.

A consortium led by Magna International Inc and Belgian investment group RHJ International have also submitted their bids for the GM Europe operation, and the United States auto maker aims to finalize a sale by the end of the third quarter.

Germany's government yesterday began reviewing the offers for General Motors Co's Opel unit.

The four German states where Opel has plants have strongly favored the consortium of Canadian auto parts maker Magna International Inc and Russian lender Sberbank, according to Hendrik Hering, Rhineland-Palatinate's state economy minister. He called for a quick conclusion of talks in view of uncertainty among employees.

"Given the two stronger rival bids and its own limited international exposure, few really believed that Beijing Auto had any chance to win," a source close to the Chinese company said.

"Still, it might not deter it from a possible bid for Ford's Volvo car brand as it has the full backing of the Beijing city government which wants a stronger auto industry," said the source.

Spokesmen from the Chinese auto maker and the Beijing government both declined to comment.

China, which overtook the US as the world's largest auto market, has been relying heavily on its auto industry to boost the economy, which is targeted to grow by 8 percent this year.

(Shanghai Daily July 23, 2009)