China's Changan confirms Peugeot tie-up talks
Chinese car maker Changan confirmed Friday it was in talks with PSA Peugeot Citroen of France on forming a new joint venture in China.
The firms have had "a string of very smooth negotiations over the cooperation", Zhang Baolin, president of Changan Automobile, told reporters on the sidelines of the Beijing Auto Show, which opened to the media on Friday.
"There is likely to be a result soon," he said, adding the talks covered both commercial and passenger vehicles.
He did not give further details.
Du Yi, a vice president of Changan, earlier told Dow Jones Newswires that the firms were negotiating to set up a 50-50 commercial vehicle joint venture and an agreement was expected in one to two months.
The new partnership will initially build cars in the southern Chinese city of Shenzhen, Du said.
Peugeot officials at the auto show would not comment on the talks.
Previous Chinese reports said the joint venture would make small cars and commercial vehicles under the Peugeot and Citroen brand names.
Peugeot already has a joint venture with Dongfeng Motor Group, but intends to increase its presence in the world's number one auto market.
It announced in January that it aimed to increase sales in China by 30 percent this year, double the growth rate for the country's whole market.
© 2010 AFP