Nissan Motor reportedly said on Tuesday its joint venture with China's Dongfeng Automotive Investment will start construction of a 3 billion yuan ($361 million) engine plant in southern China.

A CBS Marketwatch report said he new plant in Huadu, Guangzhou, will begin operations in early 2006 and, by 2008, production capacity is expected to rise to 360,000 units, with a workforce of 1,500 people.

The new plant will include casting, machining and assembly shops,  and will assemble Nissan's new global engines and supply them to joint venture partner Dongfeng Motor's passenger vehicle plants in Guangzhou and elsewhere in China, the report said, noting that Dongfeng launched two plants in China this year.

CBS Marketwatch said the Chinese automaker started producing Nissan's Sunny and Bluebird cars in May at the Huadu plant and has been also producing Teana vehicles since September in Xiangfan, Hubei Province.