Seat and First Automotive Works (FAW) could strike a manufacturing partnership in China, according to consultancy IHS Global Insight.
FAW is currently building a factory in Foshan, China, that is expected to begin operating in mid 2013 with a capacity of 300,000 vehicles a year.
The Chinese company already has manufacturing partnerships with Volkswagen and Toyota. Because VW plans to make its Skoda brand models under a partnership with Shanghai Automotive Industry Corporation, "FAW is the most likely candidate to make Seat's cars after 2013," the report said.
Acccording to Global Insight, car brands need as long as three years to achieve 100,000 annual sale units in China and Seat would need one third of Foshan's capacity to meet this goal.
A Seat official confirmed president James Muir's comments last week that Seat will enter China via the launch of its Leon and Ibiza models next year.
Muir said the Chinese expansion will be carried out through "moderate" sales and that cars will exported to China from its main Martorell factory near Barcelona, Spain.
Moreover, Seat hopes to return to profit in 2013, the official confirmed.