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By Madeline Chambers, European Auto Correspondent
LEIPZIG, Germany, Aug 20 (Reuters) - German sportscar maker Porsche AG took the wraps off the world's fastest sports utility vehicle (SUV) on Tuesday, the model it hopes will drive its profits to new heights. "The smallest independent carmaker in the world is taking on a new dimension here in Leipzig," Porsche Chief Executive Wendelin Wiedeking said at a ceremony to mark the opening of the carmaker's new plant in the eastern German city of Leipzig.
The new car, called the Cayenne, has Porsche's distinctive sloping bonnet and headlights and is the company's third product line after its 911 and small Boxster sportscars. It goes on sale in the autumn.
The Cayenne Turbo, with a top speed of 266 km (165 miles) an hour, will cost almost 100,000 euros ($98,000) and can reach 62 miles per hour in 5.6 seconds. The more modest Cayenne S, which will cost 60,000 euros, has a top speed of 242 kmh.
Observers at the ceremony commented that the model looked more impressive than it had in pictures shown earlier in the year, which had disappointed many Porsche fans.
Its appearence is sleaker than BMW's successful X5 and the new Ford Range Rover, but the Cayenne is a bulky, four-door family vehicle and is far removed from Porsche's image as a maker of some the fastest cars on the road, say some experts.
CAR CHANCELLOR
German Chancellor Gerhard Schroeder, seeking good publicity ahead of next month's election, drove a silver new Cayenne fresh off the production line into a stadium accompanied by a fanfare of roaring Porsche engines. He described it as "a dynamic ride".
The world's most profitable carmaker hopes to sell 25,000 of the new SUVs a year, boosting its unit sales by 50 percent.
Analysts think that goal is achievable even in the current uncertain economic climate, with the bulk of demand coming from the United States where Porsche sells about half its cars.
"International demand for our Cayenne ... is clearly exceeding our original expectations," Wiedeking said, adding that over 100,000 potential customers had expressed interest.
Porsche stock was trading 2.42 percent lower at 483 euros at 1354 GMT, erasing some of the gains the illiquid shares made on Monday, when they rose nearly six percent.
Wiedeking said he had put off plans to apply for a U.S. listing due to concerns over new U.S. corporate governance rules.
SAXONY GAINS
Porsche invested 127 million euros in the new plant, which will employ 370 people. Its presence adds to a growing hub for auto manufacturers and suppliers in the eastern German state of Saxony, formerly in the Communist East.
"Leipzig has become our second home (after Stuttgart in south western Germany)," said Wiedeking.
Europe's biggest carmaker, Volkswagen , produces 150 luxury Phaeton cars a day in a new glass factory in nearby Dresden, and BMW has committed one billion euros to a new plant in Leipzig.
"The new factory shows that it is (economically) worthwhile to produce high quality, high-tech products in Germany," said Schroeder, who described himself as a "chancellor of cars".
"Porsche and BMW, along with the other companies that are moving here, will help to revive the strong tradition of the auto industry here and contribute to the economic situation."
Schroeder has close links to the car industry, which accounts for one in five jobs in Germany. He was on VW's supervisory board as premier of the state of Lower Saxony.
He also said Tuesday's ceremony, taking place as devastating floods were still taking their toll on swathes of eastern and northern Germany offered a glimmer of hope to the region.
GOOD CHANCES
Despite estimates that growth rates for sports utility vehicles will outpace that of other segments, the Cayenne faces stiff competition. BMW's X5 is the undisputed leader in the premium SUV segment, and other rivals include Mercedes's M Class, Ford's new Range Rover and Volvo's new XC90.
And some analysts think having an SUV in its product line-up may dilute Porsche's strong brand image as the maker of the ultimate driving machine.
Porsche is building engines for the Cayenne at its Zuffenhausen plant near Stuttgart. The Cayenne will be shown to the public at the Paris Auto Show in September.