China, it seems, has been in the spotlight of the automotive industry these past couple of years. After all, almost every automaker these days has a factory over there, wanting a piece of the huge sales potential in that market. Now, even AMG is set to build cars in the People's Republic.

Yes, you read that right. Mercedes-Benz's in-house tuning division will be making cars in China soon, and the first China-built AMG will be the A35 L, meaning long-wheelbase. So why is AMG doing this?

At the moment, AMG models have to be imported from Germany, all the way to China. Over there, imported vehicles carry a big tariff, making them far more expensive than they are in their respective home countries. Couple that to the relatively huge engine sizes of AMG cars and SUVs, and these cars can carry a heft tariff. Such is the price of imported luxury vehicles in China.

Coming soon: Mercedes-AMG by BAIC Motor image

But Mercedes-Benz has gone around that already, at least for select models. For a while now, Germany's biggest luxury automaker has had a joint venture with BAIC. Under this partnership, Mercedes-Benz has been building the C-Class and E-Class in China, allowing them to avoid the heavy duties and taxes the country imposes on imported goods.

Mercedes-Benz has since observed that the AMG A45 became the performance brand's top seller in the market. Because of that, the decision to build the all-new A35 L sedan in China has been green-lit. The first China-built AMGs will roll off in one of BAIC's facilities by the end of the year.

That said, not all AMG models will have an assembly line in China, and with the A35 L being a China-only model, it's unlikely we'll see a BAIC-made AMG in the Philippines; at least for now.