German steelmaker ThyssenKrupp said its joint venture unit in China and Chinese producer Ansteel were examining a proposal to build a coated auto sheets production line in southwest China.

Ansteel signed an agreement with the Chongqing Development Zone, south of Sichuan Province.

Tagal, the joint venture of Ansteel and ThyssenKrupp Steel Europe in Dalian, will also take part in ‘the intensive, open-ended examination,’ the Duisburg-based company said.

Tagal operates two 400kt/y hot dip galvanizing lines in Dalian.

The Chongqing municipal government said that the German steel group would invest into a $1.1bn auto sheet project in Liangjiang New Area consisting of two phases.

The first phase will consist of a hot-dip galvanized sheet line and cost $300M, the government report said.

The second phase, involving $800M in investment, will consist of a cold-rolling line and a downstream steel processing line, it added.