DETROIT -- Auto makers could be importing vehicles into North America from China within two to three years, Dieter Zetsche, president of the Chrysler group predicts.

"I don't think that we'll have to wait long," Mr. Zetsche said in an interview at the North American International Auto Show in Detroit yesterday.

"It's just another source for supply as Mexico is, as Canada and as Japan is and Korea is, and it'll be a source with a very competitive cost base," he said.

"It will take some time to get quality levels up to competitiveness, but this goes faster and faster as time goes by."

Automotive investment in China by the world's auto makers has mushroomed in the past year with all the major players announcing agreements to boost production in a market that is expected to become one of the top three globally before the end of the decade.

But it's more than just the domestic market there that is luring auto makers, Mr. Zetsche said.

"We are clearly working on the possibility of building products in China for other markets as well."

Auto makers have been drawn by both the low labour costs, the size of the market and growing incomes that are making cars and trucks more affordable in the world's most populous country.

Mr. Zetsche said Chrysler was among the first companies to jump into China with its Beijing Jeep operation, but failed to expand on that base and take advantage of its early entrance.

But it's building a new plant for Beijing Jeep, he said.

"Obviously, others have a stronger base in China than we do, but we intend to change that."

Industry sources said DaimlerChrysler AG has been studying intently the idea of importing small cars and other vehicles from China to compete with South Korean-based companies, which have grabbed a large share of the subcompact and compact passenger car markets in Canada and the United States.

Auto makers have also used the low costs in China as a weapon to drive the costs of the parts their North American suppliers produce as well as urging North American parts makers to open up operations to supply assembly plants there.

The car companies have also increased their purchases of parts from China.

General Motors Corp. will import an engine from China to put in the Chevrolet Equinox sport utility vehicle it will assemble at the Cami Automotive Inc. joint venture it operates in Ingersoll, Ont.