China's top homegrown carmaker Chery Automobile Co might invest a staggering 20 billion yuan to build a new plant in the Inner Mongolia autonomous region, Guangzhou Daily reported recently.

The report said the new Chery facility in Erdos was listed in a city investment promotion document.

Chery spokesman Jin Yibo confirmed to Guangzhou Daily that the two sides have been in talks, but refused to reveal details.

Based on the reported large investment, analysts estimate the Erdos plant could have an annual capacity of about 500,000 units.

The Anhui-based carmaker just began construction a month ago on a new 10 billion yuan production facility in Wuhu city that is scheduled for completion by 2012.

The company also started building a 200,000-unit plant in the coastal city of Dalian last year that will be put into operation in the middle of 2011.

With an existing annual production capacity of 650,000 units, Chery will be able to produce more than 1 million vehicles annually in two years.

The company is also reported to have plans to build a plant in Kaifeng in central China's Henan province with an annual production of 300,000 vehicles, mostly microbuses and light-duty trucks.

If both the Kaifeng and Erdos projects come to fruition, Chery will eventually reach an annual capacity of 1.8 million vehicles.

The company also plans to establish a tie-up with China's biggest container manufacturer - China International Marine Container (Group) Ltd - to build trucks. The venture's first vehicle will roll off the line at the end of this year, Jin said in a previous interview with China Daily.

As the No 1 homegrown carmaker, Chery is now known for its frequent and aggressive moves.