Five years after its ignominious departure from China, Peugeot is rejoining the flood of Western manufacturers keen to tap into the country's burgeoning car market.

The company's parent, PSA Peugeot Citroen, is contributing $75.5m (£48.6m) of a $120m a joint venture with China's number three domestic carmaker, Dongfeng Motor Corp.

The tie-up will see Peugeots built in the central city of Wuhan from 2004.

The aim, PSA said, was to reach a 15% market share.

Its sister brand, Citroen, is still in China and has already garnered 8% of the market with sales of 80,000 cars a year, up 36% on the previous year.

Rapidly rising personal incomes mean car sales in China generally are shooting up - a million cars are likely to be sold this year, a 40% gain year on year - and Western car makers are desperate for a slice of the action.

Second time lucky?

Peugeot has tried China once already, in a venture which in retrospect looks like a complete misreading of the market, said Michael Dunn, president of Automotive Research Asia.

"Last time, they came in with old products and relied heavily on government purchases and largesse from state enterprises to get them through," he told the BBC's World Business Report.

"Unfortunately they didn't have good enough relationships with the government to convince them to buy old products."

"This time is different", he said, explaining that the successful 307 model would be leading the charge on the consumer market.

But the competition is now fierce, and PSA's 300,000-cars-a-year ambitions will be tested by companies such as General Motors, Volkswagen, Ford, Toyota and Honda, all of whom have their own targets.

"Everyone is putting in their best products," he said. "It's not like the old days with only a handful of cars made in China. They won't be alone any more."