Emerging Markets

Mobius: Everybody wants a BMW in China

Orders for foreign cars have surged in China, so much so that the likes of luxury German car maker BMW are struggling to keep up with demand from the region's growing middle class, according to Franklin Templeton's Mark Mobius.

The executive chairman of the Templeton's emerging markets group said BMW was doing an "incredible job" in China. The firm's Chinese production arm Brilliance China Automotive is the largest holding in his $3.3 billlion emerging market investment trust, with 8 percent of the fund's assets invested in the car maker.

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Mark Mobius, executive chairman of Templeton Asset Management's Emerging Markets Group.
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The stock is also the top holding in a number of other funds Mobius runs. In total he oversees $44.5 billion of assets for the fund giant.

"They can't make these fast enough and they are tripling production," said Mobius, speaking at a Franklin Templeton event in central London.

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BMW said it was heading for a year of record sales after reporting demand in China for its high-end cars had boomed in the first quarter of 2014.

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The car maker said sales in Asia increased by 22 percent in the first three months of the year, powered by China, where orders jumped by a quarter and outstripped the group's sales for the Americas.

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Chinese brand cars have struggled to compete with foreign car makers and exports have fallen over 12 percent year-on-year, according to the China Association of Automobile Manufacturers. The group warned earlier this year local manufacturers' development prospects are "grave".