Foreign carmakers gung-ho on China

Foreign carmakers are rushing to raise vehicle output or open new plants in China as brisk sales and a stronger-than-expected economic recovery in the first half have raised expectations about the world's biggest auto market.

"The rebound in car sales, which has accelerated in the past few months, is prompting car makers in China to ramp up production again as they have also put in place long-term expansion plans," said Frank Gong, JP Morgan managing director and China economist.

In the first six months, China sold 4.5 million passenger cars, a 25.6-percent increase from a year ago, as the government's tax reduction and incentive subsidy for rural residents spurred small car sales.