Major Chinese automaker First Automobile Works (FAW) Group will increase research and development (R&D) spending 61 percent this year despite the financial crisis, Group President Xu Jianyi said Thursday.

R&D spending would total 4.23 billion yuan (US$619 million), he said, as FAW used the crisis "as an opportunity for structural adjustment and innovation."

FAW will focus on energy-saving and environment-friendly products this year, as well as vehicles for China's vast rural area.

The automaker said it sold more than 1.53 million motor vehicles last year, up 6.75 percent year-on-year. The increase in 2007 was 23.2 percent.

Sales for 2008 hit a record 218.4 billion yuan, up 8.8 percent.

FAW was founded in 1953. Headquartered in Changchun, capital of the northeastern Jilin Province, it has 28 wholly owned subsidiaries and a controlling interest in 18 partially-owned subsidiaries, according to the company's website.

As the world economy slowed, Chinese automakers' sales rose 6.7 percent last year, the smallest increase in 10 years. Sales totaled 9.38 million units in the world's second-largest automobile market after the United States.

Premier Wen Jiabao has urged Chinese companies to stress innovation to combat the impact of global economic turmoil.

During a visit to the eastern Shandong Province last month, Wen said "How Haier (a home appliance giant headquartered in Shandong) is dealing with the global crisis tells us there is opportunity amid crisis, and the opportunity lies in innovation, which will not only help shake off the impact of the crisis but also upgrade enterprises."

(Xinhua News Agency February 19, 2009)