FRANKFURT, Sept. 26 (AP) -- DaimlerChrysler AG is looking at selling cars made by China's Chery Automobile Co. Ltd. in the United States, a German magazine reported Monday, in a move that could help the company meet American demand for more fuel-efficient cars.

The German-American automaker is in talks with Chery about licensing its small cars for sale under its Chrysler unit's Dodge brand as demand for its SUVs and larger models wanes, the magazine Der Spiegel said, without citing any sources.

DaimlerChrysler spokesman Thomas Froehlich had no comment on the report. Chairman Dieter Zetsche said earlier this month the company was talking to potential Chinese partners about possibly producing a lower-cost model for U.S. markets.

Zetsche made the remark Sept. 15 as DaimlerChrysler formally opened its first factory to make Mercedes-Benz and Chrysler sedans in China. The Beijing factory is part of a €1.5 billion (US$1.9 billion) investment in the country.

Wang Wei, the manager in charge of publicity for Chery's General Manager's Office, said he was unaware of any such talks.

"I have no idea about the cooperation you mentioned," he said.

Trevor Hale, a spokesman in Beijing for DaimlerChrysler (China) Ltd., said he knew of no agreement. "As far as I know, there is not an agreement with anybody," he said.

Chrysler Group Chief Executive Tom LaSorda would not confirm the report. But he said the only way to make money on small cars is through a partnership that reduces capital investment and allows the company to bring cars to market more quickly while meeting low-cost and quality standards.

"All I can tell you is: Stay tuned," LaSorda said during an appearance in Detroit Monday.

He said he expected the automaker to make an announcement sometime in the fourth quarter about a partnership involving small cars.

Stuttgart-based DaimlerChrysler has projected Chrysler's third-quarter loss would be US$1.52 billion (€1.2 billion) _ more than twice what it had previously anticipated.

In response, the company announced plans to slash retail deliveries by nearly 24 percent in the third quarter, following the lead of Ford Motor Co. and General Motors Corp., which previously announced production cuts in response to slow sales of trucks and SUVs.

Chrysler is cutting retail shipments in the quarter that ends Sept. 30 by 90,000 vehicles to 290,000 vehicles. It had originally planned to ship 380,000.

The company plans to knock another 45,000 units off its schedule in the fourth quarter. For the second half, retail shipments will be cut by 16 percent to 705,000 vehicles from the previous target of 840,000, Chrysler said.