General Motors has announced it intends to boost production levels in one of the world's most rapidly emerging automotive markets.

GM is to ramp up output at its main carmaking joint venture with Shanghai Automotive Industry in Shanghai, dramatically increasing the production capacity.

The China Daily reported today (July 2nd) that GM would invest approximately $240 million to double capacity at a five-year old plant in Shanghai, leaving it capable of producing an additional 100,000 cars a year.

Meanwhile GM has already approved work on a new factory in the same location scheduled to open by 2005.

GM can now make more than 400,000 vehicles annually at four automaking ventures in China, with the company forecasting major growth in the area.

It expects to sell three million vehicles a year in China by 2012 - in a country which only last year broke the million vehicle barrier for the first time.

'The expansion will enable Shanghai GM to increase its production capacity and product line-up to keep up with rising demand,' GM said in a statement.

Analysts expect the market to grow anywhere between 15 and 30 per cent in 2003, leading GM's China spokeswoman Daphne Zheng to tell Reuters: 'If you look at how fast the market is growing, it's not difficult to figure out why we're doing this.'