The ambitious plans will significantly boost the Finnish crusher and screener bucket maker's global presence while giving them local access to the world's biggest national quarrying and construction market.
Peter Grönholm, Allu managing director, said: "The opportunity for growth and manufacturing in China is fantastic. We have a clear strategy and are continuously developing our network and always looking at improving to help the customers' requirements.
"Our people are at the heart of what we do, and safety is one of our key values. The new operational facility gives us the strength we need to invest in the future for the region by providing competitive products."
Allu China is headquartered in Kunshan, Jiangsu province, and will be recruiting short-term for its manufacturing site.