China's Chery mulling auto plant in Spain: officials

2nd September 2010, Comments 0 comments

China's largest home-grown carmaker Chery Automobile Co. is considering building a plant in Catalonia, the government of the northeastern Spanish region said Thursday.

Catalonia "is the region best positioned to host the Chinese giant," it said in a statement, following a visit to China by the head of the regional government, Jose Montilla.

Talks on a deal between Chery and Catalonia began last September, but Montilla met with the head of the company, Yi Yaontong, "to talk about the arrival of the Asian auto manufacturer in Catalonia."

They "agreed to begin drawing up a study to be approved by the board of the company on the economic and financial viability of setting up (the plant) in Catalonia," the statement said.

Spanish media said the plant would lead to the creation of 3,000 jobs directly and 10,000 indirectly in Spain, where unemployment has soared to more than 20 percent.

The plant would be built by 2012 and the first models would be produced by 2015, "aimed at the European and Mediterranean markets," the statement said.

Chery has also received offers to locate the plant in Italy or Turkey, the Dow Jones news agency said, quoting a source close to the situation.

The auto industry accounts for 7.5 percent of the gross domestic product of Catalonia, where it employs 110,000 people.

Japan's Nissan and Spain's Seat, which is owned by Volkswagen of Germany, are among the automakers with factories in the region.

Known for its low-cost vehicles, Chery became the top Chinese automaker in August 2007, 10 years after it began operations.

It has already established overseas plants in 16 countries and sells cars in more than 70 nations.

© 2010 AFP

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