Dongfeng expected sales this year to reach 1.8 million units, up from a previous target of 1.65 million to 1.7 million, Zhu Fushou, president of the company said at a media briefing to discuss the company's mid-year results.

He added that sales growth had slowed in recent months, with sales in the second half expected to be lower than the first half when the company sold 972,000 vehicles, up 59 percent from the same period last year.

"Our gross profit margin could hold steady in the second half if we achieve the sales target," Zhu said.

China, the world's largest auto market, saw strong demand for vehicles in the first half fuelled by government stimulus policies. It lifted Dongfeng's gross profit margin by 4.8 percentage points to 22.7 percent in the six month period.

Zhu said overall auto sales in China were likely to rise about 17 percent for the year. That would mark a considerable slowdown from the 47.7 percent increase in the first half, as Beijing takes measures to cool the economy to keep it from overheating.

Last week, Dongfeng reported a net profit of 6.53 billion yuan ($960 million) for the first half of 2010, more than double the 2.56 billion yuan it earned for the same period a year earlier.

Dongfeng Motor plans to invest 3 billion yuan ($441.4 million) in the next four to five years to develop and produce green energy cars in China to help reduce carbon dioxide emissions, said executive vice president Zhou Wenjie.

"We plan to roll out hybrid and pure electric cars together from 2012 or 2013," he said.