BIEN HOA, Vietnam, April 25 (Kyodo) — Suzuki Motor Corp.'s Vietnamese unit held a groundbreaking ceremony Wednesday for a new automobile plant in Bien Hoa in the province of Dong Nai.

By investing about 1 billion yen, Vietnam Suzuki Corp. is relocating from its existing plant in the same province to the new factory to start production next year.

The annual output capacity of the new plant is set at 5,000 vehicles in the first business year and will be expanded, it said. Vietnam Suzuki made about 3,000 vehicles in the last business year.

Speaking at the ceremony, Suzuki Motor Chairman and President Osamu Suzuki said, "By expanding (the new plant), we can possibly achieve an output capacity of 10,000 to 20,000" in the future.

While indicating the company intends to raise the ratio of local parts procurement, he also said the company would aim to become the top manufacturer in Vietnam.

Suzuki has been producing automobiles and motorcycles in Vietnam since 1996. The new automobile plant will be constructed next to the two-wheel plant that was built in 2006.

The number of registered vehicles in Vietnam rose to 1.6 million in 2010 from 490,000 in 2000, and the country's transport ministry projects it will increase by 10 to 15 percent a year and reach 3 million by 2020.