South Korea's Ssangyong Motor Corp, the country's fourth-biggest carmaker, has renewed plans to set up a manufacturing plant in China, according to media reports.

But Shanghai Automotive Industrial Corp, which owns a majority stake in Ssangyong, told Shanghai Daily that discussions on how the vehicles made by South-Korea's fourth-largest automaker would be brought to China are still under way.

The media report, quoting an unidentified senior executive at Ssangyong, said the company wants to assemble its Kyron sports utility vehicle under cooperation with SAIC.

A translation of the report was posted yesterday on the Chinanews.com Website.

The news comes several months after Ssangyong's president announced a decision to drop a similar plan after the Chinese government's revealed it was considering stricter approval requirements for new joint ventures due to overcapacity in China's auto industry.

According to the new reports, the Pyeongtaek-based company aims to sell 20,000 Kryons a year in China after 2008.

The Shanghai Security News said Ssangyong is likely to begin production through a technology transfer and set up manufacturing plants in China later.

Any plan to begin China production, however, will need approval from SAIC, which owns 50.91 percent of Ssangyong.

"We are still under discussions on how to introduce Ssangyong's vehicles in China, whether through licensed manufacturing or setting up a new factory," an SAIC spokesperson told Shanghai Daily yesterday.

In its blueprint for Ssangyong, SAIC, China's second-largest carmaker, is investing 2.5 trillion won (US$2.5 billion) in the next five years to improve the company's international competitiveness. The money will be used to roll out several new models and sell 340,000 units by 2010.

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