One of China's biggest automakers said its mini-van joint venture with General Motors (GM) has merged with an idle vehicle plant in Shandong Province to speed up expansion.

SAIC Motor Corporation Limited has formed SAIC GM Wuling through the venture, and will upgrade the vehicle plant in Shandong - previously controlled by China's tobacco giant Yizhong Group - with an annual production capacity of 68,000 mini-vans, SAIC Motor said.

The plant in Shandong will be SAIC GM Wuling's mini-van base focusing on the market in northern China, SAIC Motor said.

SAIC GM Wuling in Guangxi Zhuang Autonomous Region is the nation's second-largest mini-van maker after Chang'an Motor Corp.

The venture's sales grew by 30.5 per cent to more than 235,000 units last year.

The plant in Shandong started to produce vans and cars at the end of 2000 based on models from the then British automaker Rover.

It came to a standstill last year when permission was not granted from the central government and sluggish sales were recorded.

SAIC GM Wuling will build a new 300,000-unit engine plant in 2007 in Guangxi, SAIC Motor said.

The engine plant's annual production will expand to 500,000 units.

At present, SAIC GM Wuling produces Wuling-brand mini-vans and Chevrolet Spark mini cars.

"The continuously growing mini vehicle segment is a shining point in China's auto market. The segment has become our new growth engine," SAIC Motor said.

Dongfeng Motor Corp, another Chinese auto heavyweight, has forayed into the mini-vehicle market recently.

Dongfeng's joint venture with Yu'an Group - a privately-owned motorcycle producer in China - launched the first Dongfeng brand mini-van earlier this month.

The venture plans to increase annual output from an expected 20,000 mini-vans this year to 150,000 units by 2008.

(China Daily June 2, 2005)