Shanghai GM, a joint venture between US carmaker General Motors (GM) and China based Shanghai Automotive Industry (SAIC), has begun construction on a new $1.1bn (CNY7bn) manufacturing facility in Wuhan city, Hubei.
The new plant will spread across an area of 2.32km2 in the city's Jingang New District and after completion in 2014 it will increase the carmaker's annual production capacity to 300,000 units.
GM China president and managing director Kevin Wale said Shanghai GM Wuhan will allow the company to better reach out to customers in this part of the country, where the company is expecting to see the majority of growth in vehicle demand in the coming years.
"At the same time, it will enable us to strengthen our overall production capacity to keep pace with growing demand," Wale said.
GM said that the Shanghai GM Wuhan will be the fourth manufacturing facility for Shanghai GM, after its facilities in Shandong and Liaoning.
According to the company, the new facility comprises press, body, paint and general assembly shops as well as support facilities which will be used in production of small and medium-size passenger cars, SUVs and new energy vehicles.
Shanghai GM is targeting to produce 2 million vehicles by 2015 and to achieve the target the company has increased its production in its Shanghai plant by 240,000 units while it is expanding its Shenyang plant.
Shanghai GM has registered sales of 1,200,355 vehicles in China during 2011, while the US carmaker's joint ventures in China reported sales of 231,183 vehicles in May 2012, up 21%, when compared to the corresponding month in 2011.
