Turkey says Chery Auto's partners to invest $1 billion in plant to make 200,000 cars/year

ANKARA/BEIJING (Reuters) -Turkey said on Wednesday that Chery Automobile's partners will invest $1 billion in a manufacturing facility in the country with an annual capacity to produce 200,000 vehicles a year.

The Chinese company, one of the world's top automakers, immediately issued a statement denying that it planned to build a factory in Turkey.

An official in Turkey's industry ministry, however, reiterated to Reuters that it was Chery's partners who were making the investment.

The odd sequence of statements began when President Tayyip Erdogan's office showed a video of him presenting a certificate of appreciation to Chery officials, including the president of Chery International Guibing Zhang, for its investment in a ceremony at the presidential palace.

The presidency said partners of Chery were going to invest in a facility in the Black Sea province of Samsun.

Chery soon after said: "The report by the foreign news wire is untrue. Chery has no plan to build factory in Turkey. We are seeking partnerships with a third party to expand the business in Turkey."

Earlier, Bloomberg news agency had reported details of the planned investment.

The official at Turkey's industry ministry told Reuters that among 19 new investment plans that Erdogan announced was "a production facility in Samsun for electric and hybrid vehicles and their parts, planned to reach up to $1 billion, to be carried out by Chery partners".

"In addition to these facilities, a research and development center for mobility technologies will also be established," the official added. "It is expected that these Chery-brand vehicle production facilities will provide employment for 5,000 people."

Chery would be the second Chinese car brand to be produced in Turkey after BYD, which agreed last year to build a $1 billion production plant in the western Turkish province of Manisa with an annual capacity of 150,000 vehicles.

The presidency earlier said the manufacturing facility in Samsun would produce next-generation electric vehicles and their parts.

Turkey and Chery have been in talks on an investment since last year. Erdogan met Zhang on the sidelines of an investment event in Istanbul last September.

(Reporting by Huseyin Hayatsever in Ankara and the Beijing Newsroom; Editing by Tomasz Janowski and Jonathan Spicer)