Motorcycle manufacturer Lifan Industry (Group) has announced plans to spend Rmb3.88bn to build a car plant at its headquarters in Chongqing.

When completed in 18 months, the new plant will have an annual output capacity of 150,000 vehicles. It will cover an area of 59 hectares in Liangjiang New Area.

In 2011, Lifan produced 125,700 vehicles and sold 116,600, compared with more than 4m vehicles sold by China’s market leader SAIC Group, the parent of SAIC Motor Corp.