Fuji Heavy Industries Ltd. said it is considering producing vehicles in China, in a move that would make it the last major Japanese automobile maker to make a full-scale foray into the emerging market.

Fuji Heavy, the manufacturer of Subaru-brand cars, is initially aiming for production capacity of 50,000 autos a year in response to local demand growth for its sport-utility vehicles. However, it hasn't yet determined costs or decided when or where the production facilities will be established, a company spokesman said.

The auto market in China is one of few major markets posting solid growth, with sales in the first six months of this year rising 17.7% from a year earlier, according to the state-run Xinhua news agency. This is in stark contrast with other key markets such as the U.S. where the economic crisis has depressed demand. Indeed, China could even topple the U.S. to become the world's largest market as early as this year.

Fuji Heavy vehicles bound for shipment sit in a lot in Kawasaki City, Kanagawa Prefecture, Japan, in January.
.Seven other Japanese car makers, including Toyota Motor Corp., Honda Motor Co. and Nissan Motor Co., already have production plants in China. Fuji Heavy, on the other hand, balked at beginning local production there as sales of its mainstay models -- sporty cars and SUVs -- were relatively slow.

However, since starting to export its vehicles to China from Japan and the U.S. in 2004, Fuji Heavy's sales there have roughly doubled each year, with its 2008 figure coming to 19,010 vehicles.

The car maker is also studying if it should produce vehicles in China on its own, through a tie-up with local car makers or with Toyota, its biggest shareholder with a 16% stake, a spokesman for Fuji Heavy said.

A spokesman for Toyota said he couldn't comment on such a prospect as his company hasn't been informed about the matter.