General Motors has just started work on constructing a $250 million advanced research and development facility in China’s Shanghai’s Pudong New Area. The complex will be a sprawling 120,000 square meters and will house the automaker’s China and Asia Pacific headquarters alongside the GM Center for Advanced Research and Science.

The new facility will focus on the development of alternative fuels, as well as advanced alternative-energy propulsion systems and manufacturing techniques. The first phase of the campus will open at the end of next year. When fully operational it will have more than 2,500 full-time employees. Construction started on the same day that GM marked its 100th birthday.

Ever-rising fuel costs and serious market competition have prompted GM to spend more effort developing clean-energy and fuel-efficient vehicles to maintain its lead as the largest automaker in the Chinese auto market. “We have seen a slowdown in auto sales in China, but I am very confident that for the medium and long term, China’s auto market is strong,” said Nick Reilly, president of GM’s Asia Pacific region. “We will keep our lead in China.” He has estimated GM’s annual sales growth in China to be about 10 to 15 percent over the next five years.

China is GM’s second largest market globally and also the company’s major research and manufacturing base in the Asia-Pacific region. With this new found investment, it is clear to see that China and the Asia-Pacific region will be an important market for all automakers in the near future. Hopefully, GM will take advantage of it’s head start.