(Adds Toyota response)
By Alison Leung
GUANGZHOU, China, July 23 (Reuters) - Japan's largest car maker, Toyota Motor Corp , plans to team up with a Chinese partner to make sedans in the booming southern city of Guangzhou, a top city official told Reuters on Wednesday.
Lin Yuan He, executive vice mayor of Guangzhou, said a tie-up with Guangzhou Automobile Industry Group to make Camry sedans was awaiting approval from Beijing.
"The negotiations have been proceeding very smoothly, and construction can start right after the approval has been granted," he said.
Toyota, which is already in a car-building venture in the less prosperous cities of Tianjin and Changchun in the northeast and Chengdu in the southwest, has said it is in partnership talks with several Chinese automakers, including Guangzhou Auto, and that an announcement could be made by the end of the month.
A top executive said on Wednesday nothing had been finalised, and Guangzhou Auto officials were not available for comment.
Guangdong province, where Guangzhou is located, is an economic powerhouse and accounts for nearly one third of the country's passenger car consumption.
China's auto market is in high gear, with nationwide passenger car production doubling in the first half of the year, putting the country on track to make two million cars this year.
Foreign giants, including Volkswagen AG and General Motors Corp , are planning big investments in their China joint ventures to bolster production.
Deutsche Bank analyst Lawrence Ang, citing Japanese media reports, said the Guangzhou Toyota joint venture would invest US$255 million to manufacture 200,000 to 300,000 Camry sedans per year, and said the venture could be announced this month.
Guangzhou's Lin could not provide a timetable and declined to disclose further details on the tie-up.
Toyota's current alliance with China's First Automotive Works (FAW) plans to make 300,000 to 400,000 compacts, luxury sedans and sport utility vehicles annually in China by 2010.
City government-owned Guangzhou Auto already has a joint venture with Toyota rival Honda Motor Co , Japan's second-ranked automaker.
Guangzhou Auto is the controlling shareholder of Hong Kong-listed Denway Motors Ltd , which is the indirect joint venture partner of Honda in a Guangzhou plant that makes Accord sedans and Odyssey minivans.
The Guangzhou government hopes to build the plant in the city's new Nansha industrial district, although a location has not been finalised, Lin said. (Additional reporting by Chang-Ran Kim in Tokyo)