General Motors may be reviving plans to build cars in Russia as a partner of that country's second largest automaker, GAZ, local media reports said on Wednesday.

GAZ is negotiating with several foreign manufacturers, but it's most likely to conclude a partnership agreement with GM, deputy chief executive Yelena Matveyeva told Ladimosti. Last week, officials of the companies met at a GM factory in South Korea, she added, without giving details. An official at GM's operation in Russia confirmed the talks for Dow Jones but wouldn't comment further.

Talk of a GM-GAZ collaboration first arose in 2008, but the onset of the financial crisis halted plans. It was revived last year, said Chris Gubbey, who at the time was GM's managing director for Russia. At that time partsmaker and contract vehicle assembler Magna International [which helped GAZ set up the assembly line for the Chrysler-based Volga Siver] - ed] formed a consortium with state-owned Russian retail lender OAO Sberbank with GAZ advising on technical matters - to buy 55% of GM German unit Opel. The deal fell through in November when GM dropped its sale plan, but the Detroit company and Sberbank resolved the latter's compensation claims, Dow Jones noted.

But GAZ had found the idea of performing assembly work under contract uninteresting and would have preferred teaming with a foreign auto maker to develop a new vehicle, said Valery Lukin, a member of the GAZ board and chief executive of the company's biggest shareholder, Russian Machines.

GAZ Chairman Bo Anderson, once a vice president at GM, said early this year that the company had enough parts to build about 2,400 Siber sedans, after which it would end production of that model. But the plan no longer stands, said Matveyeva, explaining that Siber demand has grown and that GAZ intends to produce 5,100 by the end of 2010. She added the assembly line would allow concurrent production of other models, including a potential joint project with GM.

GM's plant in Russia, on the outskirts of St. Petersburg, opened in late 2008 and mainly produces compact sedans and crossover sport-utility vehicles but can be retrofitted for other types of vehicles, the report noted.

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