Volkswagen Group premium brand Audi is in talks with long-term partner FAW Group about creating a second joint venture to build electric cars on its PPE platform in China, Reuters said, citing a weekend report in Germany's Automobilwoche.

Audi and FAW have a Chinese joint venture to build combustion-engined cars in the northeastern city of Changchun and the southern city of Foshan.

An Audi spokeswoman declined to comment to Reuters on the report.

Lst July, it was reported the Volkswagen-SAIC Motor joint venture would spend CNY4.13bn (US$590m) to revamp its car plants in Shanghai to make Audi sedans, according to a government document seen by Reuters.

The report noted JV SAIC Volkswagen, China's biggest automaker, currently only sold cars under the Volkswagen and Skoda brands.

According to the report, the Shanghai plant revamp would give the JV an annual manufacturing capacity of 60,000 Audi A7L sedans and 60,000 new VW SUVs. Total capacity at the plants would remain unchanged.