Peugeot, Dongfeng to build 3rd plant in China this year

French car maker PSA Peugeot Citroen aims to start building its third China plant with partner Dongfeng Motor by the end of this year, two sources said on Wednesday, as it moves to more than double its share in the world's largest auto market.

PSA Peugeot, which already operates two facilities in China with partner Dongfeng Motor Group Co, wants to sell up to 400,000 cars in the country this year, approaching its annual capacity of 450,000 units.

"The two partners want to build the new plant within the year and are working out the details now," a source with direct knowledge of the matter told Reuters.

The plant, with annual capacity of between 150,000 to 200,000 units, is scheduled to be up and running by 2012, said the source.

Site of the greenfield plant and product mix have yet to be finalised but the central city of Wuhan, where the two existing plants are based, is among the options, said another source familiar with the matter.

"Dongfeng and PSA are still selecting sites now. Things will be firmed up in the next few months," the source added.

PSA Peugeot declined to comment and Dongfeng executives could not be immediately reached.