Media reports in Japan say that Mazda Motor Corp. will - for the first time - lead the development of a Ford Motor Co. group's passenger car. Mazda has reportedly said that it will play a key role in the joint development of the successor to Ford's Fiesta and Mazda's Demio.

So far, the companies have jointly developed models.

The Nihon Keizai Shimbun reported that the next generation car will be launched in 2007 and increasing the percentage of shared parts with the Ford group to more than 50% from the current 20% will cut production costs.

The newspaper also reported that Mazda estimates annual production at about 150,000 units, while Ford is projects output of around 350,000 units.

Mazda has not yet commented on the reports.