Fiat has signed an agreement with Chongqing Xiaokang Auto Industry Group to launch a diesel engine project in Liang Jiang Xin Qu of Chongqing Municipal, southwest of China’s biggest industrial and commercial centre, local media reported.

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The aim of the project is to produce environmentally friendly diesel engines which have fuel consumption of around 5.5 litres per 100km up to 40% more fuel-efficient than petrol engines.

The project will be in two phases, and will have an annual production capacity of 300,000 diesel engines and 100,000 vehicles and generate annual sales revenue of over CNY12bn (US$1.8bn) when completed, Wong Jieming, management committee director of Liang Jiang Xin Qu said at the signing ceremony.

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