A German magazine says Volkswagen's upmarket brand Audi prefers an assembly plant in Mexico rather than using VW's new Chattanooga factory.
Manager Magazin said Audi Chief Executive Rupert Stadler wants a new factory in Mexico to produce the sport utility vehicle Q5.
But, the report said it was still unclear if Stadler would have his way in the face of opposition from some of Volkswagen's top managers, who want Audi to make use of the new Chattanooga factory.
The Chattanooga plant this spring started production of an all-new midsize Passat. The Enterprise South industrial park plant has capacity to make 150,000 vehicles a year.
The magazine said a decision could be made as early as this October.
Audi does not have its own factory in the United States.