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BMW, Brilliance and local Chinese officials attended the official opening of BMW’s 2nd Chinese plant this week (Photo: BMW)

BMW and its joint-venture partner Brilliance opened a second plant in China,increasing production capacity in the key market to 200,000 vehicles a year.

The German premium car makerand its partner will invest another 500 million euros to boost production capacity in China to 300,000 units in the medium term. And BMW CEO Reithofer, speaking at the opening of the Tiexi facility in Shenyang in northeastern China, said the company's flexible production structure will even allow it to build 400,000 vehicles a year, should demand justify such a move.

"China is one of the BMW Group’s top three markets worldwide and offers tremendous potential for growth, especially in the premium segment," Reithofer said.

In the first four months of the year, BMW boosted group vehicle sales 35 pc to 107, 211 units. And despite a slowdown in the overall growth rate of the Chinese market, Reithofer said he expected double-digit growth for BMW for the full year. In 2011, BMW group sales jumped 37.7 pc to 233,630.

As part of its growth strategy in China, BMW expanded its dealer network to 290 last year from 210 a year earlier.

BMW said its new Tiexi plant will feature a range of new technologies to boost efficiency and make the facility as sustainable as possible. The company cited more than 60 different measures for resource-efficient production, including optimized energy and water consumption, waste management, wastewater processing and other measures.

In addition, part of the plant will get its electricity from wind power.