Asda’s expansion plan reflects the confidence sweeping through the boardroom about the supermarket’s potential given the far tougher economic climate.

Just like it’s owner, Wal-Mart, Asda believes that it will benefit as customers tighten their belts given its reputation for being the cheapest out of the UK’s Big Four.

Wal-Mart yesterday reported sales of $100 billion for the three months to January 31 after reaping the rewards of a return to its value roots.

As far as Andy Bond, Asda's chief executive, is concerned Asda and Morrisons will be the big winners this year at the expense of more premium players like Sainsbury’s and Waitrose.

However he insists that it is far too simplistic to label Asda as a chain for low-income customers.

He claims that Asda has already added 600,000 new ‘AB’ consumers in the past year and is far more representative of the UK population than any of its rivals.

Some of its biggest sales growth is coming in organic and premium own-label food ranges.

Asda has the benefit as the overseas offshoot of a US-listed company of being able to hide much of the financial detail that could back up claims of its outperformance in the market.

However it is clear that with a resurgent Morrisons and an ambitious Asda that refuses to be beaten on price, competition in the grocery sector will be as cut-throat as ever this year.

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