Mazda Motor Corporation has announced that its versatile Premacy 'space hatch' will be assembled in China for the local market.

Speaking at a Press conference in Tokyo, President Mark Fields said Mazda had reached an agreement with the motor vehicle builder First Auto Works Hainan to begin production in Hainan Provice next June with a target of 20,000 units per year by 2004.

Mr Fields said that Mazda would provide technical support for Job 1 to achieve the required quality standards.

"We believe that this business venture will meet China's policy of developing their automotive industry and improving their means of transportation as well as providing Mazda with an excellent growth opportunity," he said.

"As well as this it will provide further volume opportunities for Chinese dealers who are being actively recruited."

Mazda currently sells approximately 3400 vehicles per annum in the People's Republic of China including 323 and 929 passenger vehicles and B Series commercials.

Premacy is currently sold in Japan and Europe and will be launched in Australia this February.