German steel and engineering group ThyssenKrupp AG said it was setting up a raft of new factories in China to cater to car makers in the world's fastest growing car market, Reuters reported.

According to the report, the company will establish three new factories in China with local partner ANSC Angang New Steel Co. to build tailored blanks -- laser-welded sheets of metal used by manufacturers to form car parts such as doors and floor panels.

Ulrich Jaroni, the board member at ThyssenKrupp Steel with responsibility for the auto division, told Reuters the company would invest between €25 and 30 million ($US27-32 million) in each of the plants.

"Current forecasts suggest annual growth in the Chinese car market of around 12% to 6.9 million cars by 2008," Jaroni told Reuters, adding: "We follow our global customers to their production facilities all over the world."

Reuters said ThyssenKrupp - the world's biggest stainless steel producer - recently set up a tailored blank site in the central city of Wuhan, and said it now planned similar sites in Shanghai, Guangdong and Changchun, where Volkswagen, Toyota, and Mazda are expanding capacity.

Reuters noted that fellow German car parts maker Continental - which specialises in high-margin electronics - also is looking to take advantage of China's growing car market and its chief executive has said he is actively looking for a Chinese partner.

ThyssenKrupp reportedly said it also was lifting capacity at its tailored blanks factory in Duisburg-Huettenheim, Germany, investing €55 million euros to double capacity and create 100 new jobs.

Reuters noted the group is in the middle of a revamp aimed at cutting debt and increasing profitability and has said its automotive business will be one of its key growth pillars, lifting sales to €10 billion by 2006/2007 from €6.3 billion last year through organic growth and acquisitions.