US based automaker DaimlerChrysler has confirmed that they are indeed talking with Chinese automobile company Chery for a possible joint venture to sell a mini car in the US market.

However, Chery is not the only one, Daimler is in fact talking with several other companies and this might even include the German giants Volkswagen.

George Magliano, automotive research director for Global Insight spoke about the possibilities: “We understand the talks between Chrysler and Volkswagen broke off, and so teaming with a low-cost Chinese producer is the way for Chrysler to compete with Ford and GM in the mini-car market.”

And they are also not alone as both Ford and General Motors are also working on similar concepts to launch some compact cars in the market, which are becoming increasingly popular.

GM has a huge advantage here considering they now own Daewoo, which specializes in manufacturing compact cars.