The new venture, which will be for 10,000 units in its first year, will be through a partnership with Nissan's 30 per cent-owned Zhengzhou Nissan Automobile Co.
Production on the Paladin SUV, available in 2.4-litre and 3.3-litre models, started on Tuesday.
Zhengzhou Nissan makes the Nissan-branded Pickup and has an annual production capacity of 60,000 units.
Nissan also has a 50-50 venture with Dongfeng Motor Corp, one of China's largest auto groups. That venture aims to roll out 550,000 vehicles by 2006.