German carmaker Volkswagen AG has raised its 2007 sales target in China by 12 percent, inspired by a stronger-than-expected performance in the first three quarters.

Winfried Vahland, president and CEO of Volkswagen Group China, said yesterday it aims to sell 900,000 cars this year in the world's second-biggest vehicle market, up from the earlier goal of moving 800,000 units.

The company sold 711,298 units in China in 2006.

From January to September this year, Volkswagen's China sales surged by 30.2 percent year-on-year to 684,786 units, outpacing a 24 percent growth of the country's entire vehicle market, Vahland said.

The sales, which helped the group maintain its two-decade leadership in China's passenger car sector, included 594,270 vehicles under the Volkswagen brand, 76,168 Audi premium cars and 14,094 units from its Czech arm Skoda.

Propelled by the brisk sales growth and Volkswagen's cost-cutting endeavor, the group increased its profits in China faster in the third quarter than in the first half, Vahland said, without providing details.

He said the company will slash costs in China by 30 percent this year from 2005. Under a plan launched in 2005, labeled the "Olympic Program", it aims to cut China costs by 40 percent in 2008.

"We are considering building more production capacity in China to meet future demand," he said.

Volkswagen now has an annual production capacity of 1 million cars in China. It runs two tie-ups with SAIC Motor Co and FAW Corp, the top two local automakers.

US carmaker Ford Motor Co said on Tuesday that sales of its wholly owned brands - Ford, Lincoln, Volvo, Land Rover and Jaguar - grew by 30 percent to 149,455 vehicles in China in the first three quarters of this year.

General Motors and Toyota, Volkswagen's two closest rivals in China, have not yet revealed their January-September results for the country.

(China Daily October 12, 2007)