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According to reports, Volkswagen is weighing the idea of cooperating with Chinese automaker Great Wall to build a new budget car. German publication Manager Magazin reported earlier in the week that discussions had been held, citing company sources.

The magazine also reported that one of the options being mulled in talks was VW taking a stake in Great Wall. Both automakers remained quiet on the subject, Reuters reports; VW declined comment and a Great Wall spokeswoman said the company was not aware of the issue.

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It’s no surprise to find that VW is looking at that path – the company is aware that it needs to build such vehicles for deployment in emerging markets, and its China boss Jochem Heizmann had earlier said the automaker was considering the development of cheap SUVs and people movers to meet growing demand for such vehicles.

The issue has been keeping the cost low enough to be competitive in the budget segment, something that continues to elude the automaker – while something like its up! small city car works for Europe, it would still be too expensive a pick for emerging markets. According to an analyst report published on the subject, a partnership with a company like Great Wall would go a long way in attempts to build a cheap and cheerful car for the masses.