Carmakers eye partners as tough markets loom

PARIS (Reuters) - Carmakers sought more partners to cut costs and boost efficiency as the Paris Auto Show got under way on Thursday, highlighting the sector's need to streamline while dark clouds over the economy keep major markets tough.

Volkswagen's crafty chairman cast an eye on Fiat's Alfa Romeo brand in the run-up to Europe's biggest car show and Japan's Nissan Motor <7201.T> said it will explore broader cooperation with Germany's Daimler .

"Thirteen is my lucky number," VW Chairman Ferdinand Piech joked late on Wednesday, referring to the number of brands his sprawling group would have if it bought Alfa in VW's race to topple Toyota Motor Corp <7203.T> as the world's top automaker.

Fiat has said Alfa is not for sale.

Infiniti, Nissan's luxury brand, will talk to the maker of Mercedes-Benz cars about sharing a Daimler sedan platform and its engines, a top Nissan executive said, expanding a three-way alliance including France's Renault .

Japan's Toyota put a brave face on a safety scandal that dented its reputation for quality, forecasting it will sell more cars in Europe next year even if the market dips.

PSA Peugeot Citroen Chief Executive Philippe Varin also took an upbeat line, confirming the French group's 2010 operating profit goal and suggesting European market volumes would be flat or slightly better than this year despite the end of cash-for-clunkers incentives in many countries.

"In emerging countries we're going to see continuing growth. In Europe we think 2010 is a low point, so 2011 should be higher or equal to 2010. We don't see huge growth in 2011 on the horizon," he said.

GM's Opel division said the western European car market had hit bottom but would stay depressed in 2011.

Many carmakers are set to unveil zero-emission electric cars at the Paris show, testing whether consumers are ready to pay for vehicles that remove internal combustion engines from the environmental equation.

At the last Paris Auto Show two years ago, carmakers had yet to comprehend the full scale of the crisis that would engulf the industry, forcing bankruptcies and favoring alliances as demand for new cars slumped and production plummeted.

European governments supported carmakers, introducing scrapping schemes that spurred demand as drivers got generous bonuses to trade in their old cars for newer, greener versions.

Now most of those schemes are finished, carmakers are increasingly relying on booming emerging markets, in particular Brazil, China, and India for future growth.

"It's no news that the first place is China for most of us, definitely for Mercedes, but it doesn't stop there," Daimler Chief Executive Dieter Zetsche told Reuters Insider.

"Within the BRIC countries certainly Russia is taking up again, Brazil -- in the volume segment more than the premium segment -- is growing very fast, meanwhile overtaking Germany as a car market. And we have as well in India good sales rises."

Carlos Ghosn, the chief executive of both Renault and Nissan, said on Wednesday the global auto crisis was "behind us" and predicted Nissan would sell 950,000 cars in China this year.

VW's premium brand Audi expects to sell more than 300,000 cars a year in China as early as 2012 and at the latest in 2013, it said, adding it planned to expand production capacity there with partner FAW Group in the medium term.

Booming demand in China helped German sports car maker Porsche AG post record revenues.

The European car market is not expected to return to the pre-crisis level of sales it achieved in 2007 until around 2013.

Car sales in many major markets including Japan, France, Spain, Italy and the United States are due out on October1.

(Additional reporting by James Regan, Writing by Michael Shields; Editing by Hans Peters)