"We will increase our production from 50,000 units this year," said Honda spokeswoman Sachi Ito, while declining to confirm the scale of the increase.

"Our production capacity is full," Ito said.

"We will build an additional welding plant by spring 2002 and expand our painting factory by autumn of the same year to strengthen our production capacity."

Local subsidiary Guangzhou Honda Automobile Co began production of the luxury Accord model in 1999. In its first year, the firm produced 10,000 cars, followed by 32,000 last year.

The Accord has about 20 percent of China's luxury car market, the spokeswoman said. Honda's Odyssey minivan may also be produced at the Guangzhou factory near Hong Kong, she said.

The Nihon Keizai Shimbun business newspaper said the plant's annual capacity would exceed 70,000 units by autumn 2002, a 40 percent increase from now.

Guangzhou Honda, a joint venture between Honda and Chinese firm Guangzhou Automobile Group, makes 2,000cc and 2,300cc versions of the upscale Accord.

As part of its expansion in the world's most populous country, Honda plans to increase its dealerships in China from 68 to 120 this year, according to the Nihon Keizai Shimbun.

Competition is heating up in China with Japan's top carmaker Toyota Motor Corp and US giant General Motors Corp also expanding production of upscale sedans.

Total car sales in China jumped 13 percent in 2000 to 2.07 million vehicles.

(China Daily 05/14/2001 )