Berlin  - Germany is to inject government funding into engine-design work in the car industry, Chancellor Angela Merkel said in a newspaper interview published Sunday.

She spoke as the industry, a key German exporter, scales back production amid plunging worldwide sales.

"Germany invented the first cars a century ago. Now we are in a fresh competition to see if German industry can build the 21st century car," Merkel, who has a doctorate in physics, told the Bild am Sonntag newspaper.

She said German carmakers had to try harder to innovate.

London, Jan 11 : The Terrafugia Transition, which can transform itself from a two-seater road car to a plane in 15 seconds, is scheduled to take to the air next month.

If it survives its first test flight, the technological breakthrough, is expected to land in showrooms in about 18 months' time.

Its manufacturer says it is easy to keep and run since it uses normal unleaded fuel and will fit into a garage, reports TimesOnline.

Taipei - Taiwan's Aerospace Industrial Development Corp (AIDC) will join Japans's Mitsubishi Heavy Industries Ltd in developing regional jets, the Central News Agency (CNA) said Saturday.

Mitsubishi has invited AIDC to jointly develop regional jets due to AIDC 's capability in aircraft design and manufacturing, CNA quoted Economics Minister Yin Chi-ming as saying.

AIDC and Mitsubishi have formed a "partnership relationship" on developing commercial regional jets. Yin will visit Mitsubishi's aeronautics department next week to push the deal, CNA said.

Berlin - Defying recession, the Skoda division of German Volkswagen intends to expand its factory in China and build another in India, according to the chief brand officer at Skoda, Reinhard Jung.

In a report released Saturday by the German weekly Auto Motor und Sport, he said, "This year we want to double our Chinese capacity, which is currently 50,000 to 60,000." He said Skoda would set up new factories in Russia and China.

Bangkok  - Thai-based car manufacturers have lowered their production targets to 1.08 million vehicles this year, down 23 per cent from 2008 output of 1.4 million cars, media reports said Saturday.

Of the targeted 1.08 million units, 500,000 are expected to be sold on the domestic market and 580,000 exported.

"This figure is an estimate based on the present situation," said Piengjai Kaewsuwan, chairman of the Automotive Industry Club, which met Friday.

Munich- A dramatic slump in year-end deliveries saw luxury carmaker BMW post its first annual decline in sales for 15 years, according to figures for 2008 released Friday.

The Munich-based company said it sold 1.44 million cars last year, a drop of 4.3 per cent compared to 2007 when BMW recorded its best year ever.

It was the first annual decline in sales since 1983 when the boom triggered by German unification three years earlier began to fade.