The manufacturing base in Chengdu, capital of Sichuan Province, would comprise a vehicle assembly plant, an engine plant and a transmission plant, said Li Hua, deputy director of the economic development zone of Chengdu.

The vehicle plant was slated to begin production by 2013 with an initial annual capacity of 100,000, Li said.

A vehicle resembling Volvo's popular model S60 would be assembled in the plant, Li said.

The manufacturing base would include Volvo's three western centers for research, parts and components procurement and marketing, Li added.

Volvo, formerly owned by Ford Motor Co., was taken over in August last year by privately-owned Chinese automaker Geely Holding Group for 1.8 billion dollars.