SHANGHAI (Bloomberg) -- Nissan Motor Co. will almost double its production capacity in China to 1.2 million cars by 2012, accelerating earlier plans as economic growth spurs demand, CEO Carlos Ghosn said.
“China is now the second-largest economy in the world, and our ambitions and actions are aligned with the current reality,” Ghosn said today in Zhengzhou city, central China. Nissan plans to open another factory in the southern city of Guangzhou’s Huadu district in 2012, he said.
Nissan, Japan’s third-largest automaker, will build more factories and expand its facilities to meet a goal of increasing its China market share to 10 percent from 6 percent, Ghosn said, without giving a timeframe. Volkswagen AG and Nissan are among companies expanding in China, whose economy grew 10.3 percent in the quarter to June, helping boost car purchases in the world’s biggest auto market.
“We are systematically increasing our capacity in order to make sure we are not only keeping our market share but also trying to grow our market share,” Ghosn said at a media briefing after the opening ceremony of its second Zhengzhou factory.
The new Zhengzhou plant cost 1 billion yuan ($149 million) to build and has an annual capacity of 180,000 cars, Ghosn said. It will create 1,400 jobs by year-end, he said.
Nissan makes the Teana and Sylphy sedans with Dongfeng Motor Group Co. in mainland China, where it already has three car factories and one producing engines. Mainland China doesn’t include Hong Kong, Macau and Taiwan.
Renault SA plans to expand in China in the future and will do so in partnership with Dongfeng Motor Group, said Ghosn, also the CEO of the French automaker, which owns 43 percent of Nissan. Renault currently exports to China and doesn’t have any production facilities in the country, he said.
Ghosn said in April that Nissan, which currently has an annual production capacity of 670,000 cars in China, aims to increase that ability to 900,000 by 2012.
Nissan said it plans to move production of its X-trail sport-utility vehicle and Qashqai crossover from another factory in Guangzhou to the Zhengzhou plant to help ease capacity constraints. The NV200 light-commercial vehicle may be made at the new Zhengzhou factory from next year, said Kimiyasu Nakamura, president of Dongfeng Motor Co., the companies’ joint venture.
Nissan makes passenger vehicles with Dongfeng Motor Group, according to its Web site. Commercial vehicles are built through Dongfeng Automobile Co. and Zhengzhou Nissan Automobile Co., both of which Nissan controls with Dongfeng Motor Group.
China surpassed Japan as the world’s second-largest economy in the three months ended June. Passenger-car deliveries in China accelerated in August, and its automobile sales are on course to outpace the U.S. for a second year.
Nissan is in talks with Dongfeng Motor Group about the “best way” to introduce electric cars in China, which will help meet demand for vehicles in the nation while limiting pollution, Ghosn said.
“The future of electric vehicles in China is very bright,” he said.