Project Kimber has still not announced a brand name for the sportscars it plans to build, based on the Smart roadster and coupé axed by DaimlerChrysler.

Locations are being evaluated in South Wales, which beat off competition from the West Midlands and the German states of Saxony and Thueringen. It would be Wales’s first car plant.

Contracts are expected to be in place shortly, following February’s memorandum of understanding. Discussions with potential investors in the UK and North America are said to be at an advanced stage and should be concluded by September.

An announcement about dealers’ recruitment is likely soon afterwards.

A spokesman for Project Kimber says: “If these talks proceed according to plan, production is expected to commence around mid 2007. It will total 8,000 in the first 12 months‚ which compares with Smart’s sales of around 15,000 units in both 2003 and 2004.”

Both right-hand and left-hand drive models will be assembled. Assuming half the volume stays in the UK, Kimber will need a retail network of around 50 sites.

The initiative is dependent on confirmation of “a significant offer” of regional selective grant assistance made in principle by the Welsh Assembly.