Chery Automobile, China's fourth-largest passenger vehicle producer, is in talks with potential partners to set up three new auto plants abroad, according to a company executive.

"We started negotiations in the second half of last year and they are still going on," Feng Ping, vice director of the company's overseas business department, told AFP.

"It will take time as a number of issues relating to the host countries' industry policy (are under discussion)," she added.

She said issues that remain to be settled include what level of the auto parts that are to made locally and the percentage that local partners should hold in the joint ventures.

Feng declined to give any further detail.

The nine-year-old company plans to build new overseas plants in the Middle East, Eastern Europe and South America to assemble its own brand of cars, the state-run China Daily reported, citing Yin Tongyao, chairman of the company.

The company, which is based in Wuhu in the eastern province of Anhui, has already set up six assembly plants in the key markets of Russia, Egypt, Iran, Malaysia, Ukraine and Brazil, the report said.

Chery sold 305,200 cars in total last year, with overseas sales 51,600, up from 18,000 in 2005, the company said earlier.

Yin said the company aims to sell at least 393,000 units this year, with 70,000 abroad, the China Daily reported.

The company said last month it had reached an agreement to build small cars for German-US giant DaimlerChrysler and supply the global market.