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STOCKHOLM (Reuters) - Chinese-owned automaker Volvo Car Group said on Friday it had received the long-awaited approval to begin manufacturing in China at its plants in Daqing and Zhangjiakou.
The Sweden-based company is banking on strong sales of locally-produced Volvos in China, the world's biggest car market, to help it reach ambitious sales targets and secure its future in the highly competitive autos industry.
Volvo, which expects to sell 200,000 cars in China by 2018 compared with just under 42,000 last year, was granted a manufacturing license for its Chengdu plant in June but was still waiting for a green light regarding its other plants.
"Volvo Cars' full Chinese industrial footprint, including Chengdu, has been approved," the company, owned by Zhejiang Geely Holding Group Co. GEELY.UL, said in a statement.
The company, whose owner is also the parent of Hong Kong-listed Geely Automobile Holdings Ltd. (0175.HK), has been aiming for rapid growth in China to underpin a sales target of 800,000 cars by 2020, but so far progress there has been slow.
Outlining the time table for its Chinese production, the company said it expected serial production to begin in the fourth quarter at its Chengdu plant while the assembly plant in Daqing would become fully operational next year.
The engine plant in Zhangjiakou would begin operating in coming months and will supply both Chengdu and Daqing, it added.
Reporting by Niklas Pollard; Editing by Alistair Scrutton