The first car to be made in Hangzhou is expected to roll off the assembly line by the end of this year, unveiling a new chapter in the city's vehicle manufacturing history.

The first model will be a Luxgen-brand sedan developed by Dongfeng Yulon, a venture between Dongfeng Motor Corp and Taiwan's biggest auto maker Yulon Motors.

It invested a total of 3.4 billion yuan (US$499 million) to build a factory in Linjiang Auto Industrial Park in Hangzhou, which has a designed capacity of 240,000 units per year including 120,000 passenger cars, 120,000 vehicle engines and 5,000 commercial vehicles.

"Over the past 20 years, commercial vehicles and passenger vehicles have been isolated divisions in the city's car manufacturing industry," said Zhou Wenjie, deputy manager of Dongfeng Motor.

"We want to do both in the city with huge market potential and become a strong player in the future auto industry."

According to media reports, Yulon's product portfolio includes multi-purpose vehicles and sport utility vehicles. In the future, the company also plans to produce electric cars.

Besides Dongfeng Yulon, three other car makers have also opened factories in the industrial park including Zhejiang Jinhua-based Youngman Automotive Corp, ZOTYE Auto and privately-owned Zhejiang Gonow Auto Co Ltd.

Source: Shanghai Daily