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Automotive supplier Continental announced last week that it has partnered with Huayu Automotive Systems Co Ltd to establish a new plant in Chongqing.

Named the Continental Huayu Brake Systems (Chongqing) Co Ltd, the new plant will be located in Yufu Industrial Park in the Chongqing Liangjiang New Area. The plant will cover an area of more than 80,000 square meters with investment of over 600 million yuan ($96.75 million) for the first phase.

"Continental will continue to invest in China, as China is the growth engine for Continental globally," said Ralf Cramer, a member of the executive board of Continental AG, president & CEO of Continental China, at a press conference during the 2015 Global Automotive Forum.

"The auto industry is developing rapidly in western China. The Sichuan-Chongqing region represents the west China market for auto industry development. The investment in Chongqing follows our strategy of 'in the market for the market', to be close to our customers and satisfy the fast-growing demand from the Chinese market," Cramer said.

The new plant is expected to start production in 2016, and to hire more than 600 employees. It will mainly produce automotive brake assemblies, including brake calipers, vacuum boosters and electric parking brakes.

At the press conference, Cramer also said Continental would invest more in its tire plant in Hefei, Anhui province. The investment plan includes increasing its car tire annual capacity from 5 million units to 14 million units by 2019 and increasing its bicycle tire annual capacity from 2 million units to 13 million units by 2025.

To date, Continental has invested 250 million euros ($281.2 million) in its Hefei plant. The investment is expected to surpass 500 million euros when the expansion is completed, according to the company.