American based General Motors has reported a 69.9 per cent increase in vehicle sales in China for the first quarter of 2004, corroborating indications that the region is on the cusp of major growth.

The company sold a total of 122,097 cars in the January - March period.

The increase follows an aggressive expansion into the Chinese market, which saw GM joining forces with Shanghai Automotive Industry.

GM's China spokeswoman, Daphne Zheng explained: "We achieved this strong growth in a rapidly growing but extremely competitive marketplace."

She told Reuters: "We plan to keep up our momentum by continuously expanding our capacity, product lineup and local partnerships."

GM's main competition comes from the German company Volkswagen. However, VW experienced only a 5.5 per cent rise in sales in the first quarter of this year.

Vehicle sales in China have risen by 44.5 per cent in the first quarter, making a total of 567,000 cars.

The market is now recognised as the world's fastest growing, with a number of manufacturers looking to expand there.