Dongfeng Motor Co Ltd, the biggest Sino-foreign commercial vehicle joint venture, yesterday announced that it has moved its headquarters to Wuhan, the industrial and communications hub of Central China, from the smaller city of Shiyan.

The relocation comes three years after the joint venture was created by China's No 3 auto group Dongfeng Motor Corp and Japan's second-biggest carmaker Nissan Motor Co with a combined investment of more than US$2 billion.

The venture was headquartered in Shiyan at that time. The city, which doesn't have an airport, is more than 500 kilometres northwest of Wuhan.

Katsumi Nakamura, president of the venture, said yesterday at a ceremony that the relocation will make the company's operations more transparent and will greatly enhance management efficiency.

"The company has extensive operations nationwide. The move will enable us get closer to the markets and customers (in different regions)," Nakamura said.

Dongfeng Motor Co has plants in Hubei Province, Guangdong Province and the Guangxi Zhuang Autonomous Region in the south, Zhejiang Province in the east and Xinjiang Uygur Autonomous Region in the northwest.

It manufactures Dongfeng-brand buses and trucks, and cars under the Nissan nameplate, as well as spare parts.

The venture will also move its truck research and development (R&D) centre to Wuhan from Shiyan soon, it said. However, Shiyan will remain the manufacturing base for trucks and spare parts. Dongfeng Motor Co has a car R&D centre in Guangzhou, capital of Guangdong.

The relocation is part of the venture's preparations to expand overseas with trucks, Nakamura said, without elaborating.

He also said the move will help the venture attract more young talent.

The venture aims to boost its annual sales to 620,000 vehicles by 2007, including 320,000 trucks and buses and 300,000 cars, he said.

It expects to sell 460,000 vehicles in total this year, up from 403,000 units in 2005.

China's overall vehicle market is predicted to grow to around 7 million units this year from 5.7 million last year.

The venture also aims to increase annual turnover to 80 billion yuan (US$10 billion) with an operating profit margin of 10 per cent by 2007.