Due to robust sales in the world's most populous country, Mercedes-Benz expects China to unseat the United Kingdom (UK) as the company's third-largest passenger car market in the world in 2010.
Joachim Schmidt, executive vice-president of Mercedes-Benz Cars for sales and marketing, told China Daily last week that China would then soon supplant the United States for the No 2 spot.
"I personally believe that China will surpass the United States within two or three years," Schmidt said.
China now is the luxury carmaker's fourth-biggest market after Germany, the US and UK.
He said Mercedes-Benz expects to sell around 100,000 cars on the Chinese mainland next year.
Klaus Maier, president and CEO of Mercedes-Benz China Ltd, said recently that the company's mainland sales would reach 65,000 cars this year, up 65 percent from 2008.
Mercedes-Benz's sales on the mainland surged 68 percent in the first 11 months to 59,200 units, including 12,500 units of the S-Class, 6,400 new-generation E-Class cars, 14,500 locally produced C-Class vehicles and 14,000 SUVs.
Strong S-Class sales have made China the world's biggest market for the model.
In November alone, Mercedes-Benz's mainland sales hit an all-time monthly record of 8,500 cars, rocketing 224 percent from a year ago.
"The luxury car market in China will continue dynamic growth for a few years thanks to the country's steady economic growth," Schmidt said.
He said Mercedes-Benz plans to launch 16 all-new car models in the next two years globally, most of which will be introduced into the Chinese market to meet growing demand.
The company will launch extended-wheelbase E-Class sedans in the middle of next year at its parent Daimler AG's joint venture with Beijing Automotive Industry Holding Corp. The tie-up now is making the C-Class.
Analysts said the extended-wheelbase E-Class will help Mercedes-Benz boost sales in China considerably as Chinese buyers prefer roomier sedans. Rivals Audi, BMW and even Volvo have already launched long-wheelbase models in China.
Daimler and Beijing Automotive plan to increase annual production capacity of the joint venture to 75,000 or even 100,000 units in the near future from 30,000 at present.
Mercedes-Benz is also expected to launch its E-Class Cabriolet convertible, which made its global debut last week in Dubai of United Arab Emirates, as an import in China next year.
Schmidt said Mercedes-Benz plans to increase the number of its authorized dealerships in the Chinese mainland to more than 200 in a few years from 141 at present to facilitate its sales growth.
The company aims to boost its global sales to 1.5 million cars a year by 2015, up from 1.25 million units last year, he said.
Eyeing huge growth potential in China, other luxury carmakers are also stepping up production in China.
Audi, the current leader in China's luxury car market, opened a new 100,000-unit assembly plant in Jilin province in September, doubling its annual production capacity to 200,000 units.
BMW announced last month that it plans to increase its production capacity in China to 300,000 units a year in the long term, up from 41,000 units at present.
In the next two or three years, BMW's production capacity in China will grow to 100,000 units.