Early last year, Audi announced that its first premium compact SUV, the Q5, would be built in China in 2010 to avoid the import tax which makes its cars rather expensive when compared to locally-built models.

Media reports have now revealed that the locally-assembled Q5 will be launched in April this year.

The current imported 2.0T Audi Q5 models range from 570,000 yuan (US$ 83,800) to 630,000 yuan, depending on specification. The domestically built Q5 could see the price fall into the sub-500,000 yuan bracket, with many websites estimating that the pricing could be around 400,000 yuan when launched later this year.

The launch of the Q5 is likely to see the BMW X1 being put into production in China, to give the premium compact SUV segment some competition. The X1 is likely to be produced via the Brilliance-BMW joint venture in Shenyang. Mercedes might also step into the fray and produce their compact SUV offerings in China in the near future.