Central Chinese city to build second "Motor Town"

Authorities in central China's city of Wuhan will build a second "Motor Town" in the metropolis to further boost its auto industry, a government spokesman said Friday.

Local authorities have signed an agreement with Shanghai General Motors Co. Ltd. to work on the project. The local government will spend 7 billion yuan (1.11 billion U.S. dollars) on the project's first phase, which will result in an annual output capacity of 300,000 high-end automobiles, the spokesman said.

Construction on the project will begin in June, with the new "Motor Town," located in southern Wuhan's town of Jinkou, expected to go into operation in 2014, the spokesman said.

According to the agreement, the "Motor Town" will also include more than 100 auto parts businesses and logistical networks.

The second phase of the project is expected to begin in 2015, allowing the town to increase its yearly output capacity to 600,000 units, the spokesman said.

Two decades ago, Wuhan-based Dongfeng Automobile joined hands with French auto giant Citroen to build the first "Motor Town" in southwest Wuhan's town of Zhuankou.