In March, a team of senior Magna Steyr executives visited Changan and the two companies discussed assembling cars in Mexico, a marketing manager with Changan's international business division told Automotive News China.

 

A source with Magna Steyr in China confirmed the visit, but said she was not aware of any agreement reached as a result.

 

Willi Ewers, Magna Cosma International's vice president for Latin America, also told Automotive News in early June that Magna is in talks with an unidentified Chinese automaker looking to build cars in Mexico.

 

But the Mexico-based Ewers declined to identify the Chinese company and said the talks had not progressed enough to warrant a press announcement.

 

Magna Cosma is also a unit of Magna International Inc.

 

According to Changan, in February it signed a preliminary agreement in Mexico City with Mexica's Autopark Group on the establishment of a joint venture in Mexico to build Changan-badged cars.

 

The two companies plan to start assembling Changan's vehicles in Mexico in the second half of 2010.

 

Besides serving the Latin American market, the new venture is expected to sell to the North American market, Changan says in a statement.

 

The Changan marketing manager interviewed by Automotive News China said the joint venture in Mexico will start by selling Changan's vehicles imported from China later this year.

 

He added the models to be sold there will be "inexpensive cars," such as the V101 compact sedan and the Z-Shine midsize sedan.

 

The manager also said the joint venture is looking to set up its own plant in Mexico in the long term but a timetable has yet to be made.

 

Changan sold 378,239 light vehicles in China last year. But total sales of its four passenger vehicle models were only 43,287 units, according to Automotive Resources Asia, a unit of J. D. Power and Associates.

 

The four passenger vehicles Changan builds in China are the Benni mini car, Z-shine compact sedan, Joice van and CM8 small van.

 

In December last year, Changan sent its first batch of vehicles to Mexico to undergo all necessary tests required for entering the Mexican market.

 

Announcements on the company's Web site do not specify which models were sent, although the initial testing results are described as "very positive".