Chinese auto giant FAW Group is expecting its sales volume and profit to fall this year due to increased competition.

"Because of slashing demands in the international car market, many global automakers are heading toward China for further growth, which results in fiercer competition in this country," FAW president Xu Jianyi told reporters on the sidelines of the National People's Congress.

"But companies with independent R&D capacities and strong competitiveness are sure to win the market," he added. "Just as what FAW will do, to use the crisis as an excellent opportunity for structural adjustment and innovation." He said FAW would increase research and development (R&D) spending by 61 percent to 4.23 billion yuan ($619 million) this year to combat crisis.

Asked to comment on the Chinese government's call for consolidating big auto groups, he said that "If there is such a need, we will do it," although there are not yet any official plans.

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