Italian carmaker Fiat and Guangzhou Automobile Group announced Monday that they will create a joint venture to produce economy cars for the Chinese market, Dow Jones reported. The new venture will give Fiat the mainland presence it has long been seeking. Starting in May 2011, the JV will produce 140,000 cars per year, Fiat said, and may increase production up to 250,000 units. The aquisition is part of a larger expansion strategy executed by Fiat, which recently took a 20% stake in troubled US car manufacturer Chrysler. Guangzhou Automotive Group’s Vice Chairman and President Zeng Qinghong said Fiat’s technology in the economy car segment makes it an attractive partner. He also said that the new joint venture won’t harm its existing cooperation with Japanese firms Honda and Toyota.