Volkswagen AG says it has received approval from China's central government to build two plants that will annually assemble up to 300,000 vehicles apiece.
One plant will be in Foshan in south China's Guangdong province, and the other will be in Yizheng in east China's Jiangsu province, the German automaker said in a statement.
VW's joint venture with China FAW Group Corp. will build the Foshan plant, and VW's partnership with SAIC Motor Corp. will build the Yizheng factory.
The plants will begin production in 2013 and will give VW 11 factories in China. VW did not release more details, but according to the Foshan local government, the Foshan plant will assemble the Audi A3 and the seventh-generation Volkswagen Golf.
"The new factories are a key element in our plans to increase annual production capacity in China to three million vehicles in the medium term together with local partners," said Karl-Thomas Neumann, CEO of Volkswagen Group China.
Volkswagen has pledged to invest 10.6 billion euros (98.2 billion yuan) in China between 2011 and 2015.
In addition to the new plants, VW is expanding its factory in Nanjing in east China's Jiangsu province and its plant in Chengdu in southwest China's Sichuan province.
Through May, VW sold 707,524 vehicles in China. VW has 13.3 percent of China's passenger vehicle market, according to J.D. Power and Associates.