Yulon Motor, Taiwan's largest automaker by revenue, said on August 2nd that it had received the green light from China's National Development and Reform Commission (NDRC) to start producing its high-tech Luxgen passenger vehicles there from next year.

The NDRC's approval came on July 26th, according to a Chinese-language daily.

Yulon plans to manufacture the car in a joint venture with China's Dongfeng Automobile at a plant in Linjiang Industrial Zone of Xiaoshan in Hangzhou in Zhejiang Province (eastern China), with a total investment of NT$ 7.31 billion (US$ 230 million).

"We'll unveil the approval of the mainland authorities within the next two days," a Yulon spokesperson told reporters on condition of anonymity. She added that the 50-50 joint venture would have an initial capacity of 120,000 units per year, with the first Luxgen cars rolling off the assembly lines next year. The capacity will be gradually augmented to 240,000, approaching targeted annual sales of 280,000 vehicles in Taiwan.

Yulon, which now mainly produces Nissan cars in Taiwan on licence, has already invested in a joint venture with a Chinese automaker and Daimler to make Mercedes vans in the southeastern province of Fujian.

The Luxgen project has cost Yulon about NT$ 15 billion since it started four years ago. The first Luxgen, a 2.2-litre minivan for family use, was unveiled in Taiwan in September and since then Yulon has received orders from more than 10,000 local motorists, Luxgen said.