BEIJING, Nov. 17 (AP) -- Top world automakers were set to showcase new models at a Beijing auto show this weekend, each vying for a share of the booming Chinese car market.

General Motors Corp., Toyota Motor Corp., DaimlerChrysler AG and other major industry players were to be among the 1,500 exhibitors showing dozens of vehicles at the biennial Beijing Automotive Exhibition 2006, organizers said.

China has the world's second-largest car market after the United States, with 7 million new vehicle sales a year.

Major world automakers like GM, Volkswagen AG and Toyota have announced plans for billions of dollars in new investments as they ramp up capacity in anticipation of future demand from China's 1.3 billion people.

GM plans to spend US$3 billion in 2004-2007 and already has five vehicle factories and one engine plant. The company launched four new Cadillac models in China earlier this month, highlighting China's growing market for luxury automobiles.

China's auto market has grown at lightning speed in recent years as families with growing incomes shift from bicycles and scooters to their first sedans.

Other luxury carmakers, including Britain's Bentley, a unit of Volkswagen, have seen sales surge in China as racing economic growth creates a wealthy elite.

In September, DaimlerChrysler formally opened its first factory to make Mercedes-Benz and Chrysler sedans in China _ part of the company's €1.5 billion ($1.9 billion) investment in China.

The Beijing factory, which produces Mercedes E-Class and Chrysler 300C sedans, as well as Mitsubishi's Outlander sport utility vehicles, is a joint venture with a Chinese partner, state-owned Beijing Automotive Industries Corp.

On Friday, 36 of the German-U.S. automaker's E-Class sedans arrived in Beijing from Paris after a test drive. The 25-day trip through eastern Europe, Russia and China was designed to mimic a classic car race that went from Beijing to Paris in 1907.

CEO Dieter Zetsche said at the event that the company's first China-made E-Class sedans would debut Saturday.

Zetsche told Dow Jones Newswires on Friday that his company was in talks with China's Chery Automobile Co. over a possible car-making joint venture to produce a small "B-segment" car for the Dodge brand.

Zetsche said he was optimistic that a decision would be reached in the "not so far future," but he added he couldn't provide a timetable "because you can only talk about your own position. It takes two to tango."

Zetsche said his company is talking with a number of potential partners for such a deal, but when asked whether Chery is the exclusive partner for the talks in China, he said, "It's fair to say."

Zetsche said he hoped a deal could be concluded by the end of the year.

His comments marked the first time DaimlerChrysler, which has headquarters in Germany and the U.S., has acknowledged it was in talks with Chery over a possible car-making venture.

Rolls-Royce said this month that China has become the automaker's No. 3 market after the United States and Britain, due to its growing class of entrepreneurs, and that it was adding 200 employees to meet demand from China for its US$380,000 Phantom.

The show, at the China International Exhibition Center and the National Agricultural Exhibition Center, opens to the public Sunday for two weeks, and organizers said they expect 500,000 visitors during the show, which has been held every two years since 1990.