Asda plans to double its rate of expansion in Britain to an unprecedented 20 new superstores a year in the light of the Competition Commission’s inquiry into the £130 billion supermarket sector.

Andy Bond, Asda’s chief executive, said yesterday that proposed changes to planning regulations and guidelines would hand Britain’s second-biggest supermarket chain the potential for much faster growth.

The comments came as Asda outlined plans for a £400 million store opening programme this year that will create 9,000 jobs through 12 new superstores and ten more Asda Living nonfood stores. It also confirmed a dramatic expansion of its nonfood offer on the internet and vowed to continue cutting prices despite mounting inflationary pressure.

Mr Bond said: “We’re firing on all cylinders. We’re a company that is now in good health and set for further growth in 2008. Customers are tightening their belts, but I wouldn’t call this a recession. If you’re a good retailer what better time is there to expand and be bold?”

Analysts believe that Asda could be the biggest winner of the Competition Commission inquiry, given the likely introduction of a “competition test” that will prevent any one supermarket from building up a dominant position in a town or city. The measure was proposed last Friday and the Commission’s final recommendations are due in May. Asda has 345 stores in the UK, far fewer than Tesco and J Sainsbury.

Asda also hopes that a government planning review will recommend the abolition of a “needs test” that has restricted the amount of development in an area. The Competition Commission said the needs test was essentially a barrier to entry in the grocery market.

Mr Bond said: “We are pleased with what the Competition Commission came out with last week. It’s a matter of fact that 80 per cent of the population does not have access to a full choice of supermarkets in their town.

“We won’t be concreting over Britain but we would be able to grow faster as a consequence; we would be able to double our opening programme to another eight to ten a year.”

Asda’s aggressive plans hit shares in both J Sainsbury and Wm Morrison, with Sainsbury’s falling more than 4 per cent, or 16¼p to 365¼p.

Asda is still a distant second in the supermarket sector to Tesco, despite being owned by Wal-Mart, the American giant that on Tuesday reported $100 billion (£51.2 billion) of sales for its fourth quarter. Tesco’s 31.5 per cent share of the grocery market is almost double Asda’s 16.8 per cent.

However, Mr Bond said Asda was poaching customers from each of its rivals in the current economic climate given its investment in lower prices. It has added two million customers since the start of 2006.

Wal-Mart on Tuesday reported that Asda had beaten both its sales and profit targets in the year to January 31, with total sales growth of between 8 to 10 per cent.

Mr Bond said that while food inflation was a reality, Asda would be forcing suppliers to show they were doing all they can to become more efficient before paying them more. “My objective this year is to lower prices for consumers,” he said. “This is not about us squeezing our suppliers but we’ll be very focused on what we can to do to keep our costs down and what they can do to keep their costs down.”

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