General Motors has detailed plans for a major expansion in China, with $3 billion set aside to develop its automotive infrastructure, including a hub in Shanghai.

GM says it will develop a major $250 million car design centre as it moves to ramp up production in the region, and will move its Asia-Pacific headquarters to Shanghai by January.

By 2004 the firm anticipates China being its second largest market, with annual output being pushed up to 1.3 million units by 2007.

GM chairman and CEO Rick Wagoner told Reuters that the firm was even eying up its main rival in the region, Volkswagen - who currently command the lion's share of the market with 30 per cent.

"We wouldn't mind being number one," Mr Wagoner said. "The primary goal we have is growing ourselves, and the rest of the things tend to take care of themselves."

GM's sales from its Chinese ventures rose 69.7 per cent in May on the previous year.

Overall automotive sales in China nearly doubled in 2003, breaking the million mark for the first time in 2002.