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Magna International – the automotive supplier that was among bidders for Chrysler earlier this year – is said to be in talks to build a new Mini-based SUV.

According to reports in Canada’s Globe and Mail newspaper the SUV would be called the Colorado and would be built at the Magna Steyr plant in Graz, Austria.

That would be good news for Magna; Chrysler has said it is pulling its work from Magna’s Ontario, Canada plants, where the 300C, Dodge Charger and Dodge Magnum are made. Magna Steyer in Graz also builds the 300C for European markets.

There will also soon be plenty of spare capacity at Graz - BMW said in May that the next-generation X3 will be built at its plant in Spartanburg, USA in 2010; Magna Steyr currently builds the X3.

BMW has been looking at expanding the Mini line-up for some while. A new estate version, dubbed the Clubman, will be unveiled in September at the Frankfurt motor show, and more models are needed to maintain the Mini’s profitability.

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