Great Wall Motors this week announced plans to invest CNY3.7bn (US$542m) to upgrade its vehicle production operations in the Russian city of Tula, located 200km (120 miles) south of Moscow.
According to reports in China, the investment was made as part of a programme launched by the Russian ministry of trade and industry designed to attract investments from large corporations in return for tax incentives and other benefits. Great Wall was said to be the first Chinese vehicle manufacturer to sign up to this deal.
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The Tula plant was only completed in June 2019 following investment of US$500m, becoming the automaker's first wholly owned overseas vehicle plant.
The facility has an annual production capacity of 150,000 units and currently produces SUV models including the Haval F7 and the Haval H9.
The company said the additional funds would be spent on improving manufacturing capabilities, including localising production of core components such as engines, transmissions and vehicle control systems.
Russian trade and industry minister Denis Manturov said higher localisation would help Great Wall Motors become more competitive in Russia.
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By GlobalDataSpeaking at the Beijing International Automotive Exhibition, Tony Guang Sun, vice general manager of international marketing at Great Wall, told reporters "going global is an inevitable trend for Chinese brands".
He confirmed the automaker had sold some 700,000 vehicles overseas since 1998 and now had a network of around 500 dealerships in over 60 countries and regions worldwide. It is targeting 70,000 overseas sales this year.
Sun suggested the biggest concern of its overseas customers is no longer "product quality, but how long we will be there", adding the company has moved to reassure overseas customers through localising manufacturing and establishing aftersales networks.
