Volkswagen has today (July 7th) announced it is planning to boost production in the world's fastest growing car market.

In conjunction with its Chinese partners the car manufacturer has unveiled plans to double its maximum capacity in China to a total of 1.36 million vehicles by 2007.

Europe's top automotive player and partner First Automotive Works will invest a total of one billion euros to build a new plant in the northeastern city of Changchun as part of the strategy.

The news is the latest in a series of announcement from the major car companies targeting China, which saw its car market break the one-million sales mark for the first time last year.

The new plant will have a capacity of 330,000 vehicles when completed by 2007, offering another indication of the strength of sales analysts expect the market to provide.

Wang Miye, a spokesman for the Sino-German joint venture, FAW-Volkswagen Automotive Co, told Reuters that capacity would soar.

'Our target is 700,000 vehicles by 2007, but we're not sure if the increase will come through an expansion of current facilities or by building a new plant,' he said.

Volkswagen revealed sales in China leapt by 62 per cent year on year in the first five months of the year.