FAW-Volkswagen Automobile Co. Ltd. plans to invest 8 billion yuan (1.17 billion U.S. dollars) to build a factory in Foshan City, in south China's Guangdong Province, local authorities said Wednesday.

FAW-Volkswagen, a Sino-German joint venture, signed a deal with Foshan's Nanhai District Government Wednesday to build the plant between 2011 and 2013, a district government spokesperson said.

Covering 133 hectares, the plant will start producing cars in the second half of 2013 and have an annual production capacity of 300,000 vehicles, the spokesperson said.

"The new plant will not only supply south China's market but also the southeast Asian market," said Li Yiwei, head of the Nanhai district Committee of the Communist Party of China.

FAW-Volkswagen is a joint venture of FAW Group Corporation, Volkswagen AG, Audi AG and Volkswagen Automobile Investment Co. Ltd.

Guangdong Province is home to many big name automakers' factories like Honda, Toyota and Nissan.