Construction equipment maker Caterpillar is to build a wheel-loader manufacturing plant in China's Jiangsu province.

The facility, wholly owned and operated by Caterpillar, would produce medium-size wheel-loaders, said Rich Lavin, vice president of operations for Caterpillar's Asia Pacific Division.

"This facility provide the primary manufacturing source for Caterpillar wheel-loaders in the Asia theater," said Lavin.

Construction on the plant covering 57 acres in the Suzhou Industrial Park will start in early 2007 pending government approvals.

A spokesman for the company declined to reveal the value of the investment or the number of jobs to be created at the plant.

China's surging investment in rural infrastructure construction and railways has brought a strong domestic demand for mechanical equipment.

"This wheel-loader manufacturing facility in Suzhou further demonstrates Caterpillar's commitment to the continued expansion of our business in China," said Stu Levenick, Caterpillar group president with responsibility for Asia.

In the 1980s, the U.S.-based firm signed technology transfer agreements with Chinese manufacturers to build Caterpillar licensed products. Its expansion in China accelerated in the early 1990s with the establishment of a more significant local production strategy.

Caterpillar operates 13 joint venture and wholly-owned businesses in China.

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