Chinese car manufacturer Great Wall Motors Corporation has denied media reports that it will lay off around 20,000 workers in China within this year due to dwindling sales.

Great Wall said it will not cut its workforce by 20,000, which is around one-third of its current employees, even as it reported sales drop in the first five months of the year, China Business Journal reported.

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Despite Great Wall's denial, media reports said the company will cut not 20,000 but 2,000 jobs this year, mostly in its sedan department. Great Wall did not comment on this report.

Last month, the company reported that its car sales dropped 15.7 percent year on year to 52,000 units, with sedan sales falling 73.51 percent from a year ago to 4,643 units. For the January - May period, Great Wall sold a total of 298,870 units, a drop of 3.87 percent from the same period in 2013.

Great Wall Motors is shifting its focus to sports utility vehicles following a strong performance of this type of vehicles and the fast-growing SUV market in China. It recently launched its brand new H8 model, which is aimed at tapping the nation's middle- and high-end markets.

However, the H8 model has been plagued by various problems that have delayed first deliveries. In January, Great Wall decided to suspend deliveries of the H8 model due to technical problems, including engine noises.

Meanwhile, the company said it will build a car manufacturing plant in Russia with an investment of 3.2 billion yuan, around US$10 million, in order to gain better access to tis largest export destination.

In a statement submitted to the Shanghai Stock Exchange, the Hebei Province-based car manufacturer said it will enter into an agreement with the government of Tula Oblast, a district located south of Moscow.

The Russian factory is expected to produce up to 150,000 vehicles annually. An initial investment of 2.1 billion yuan (US$337 million) will be used for the first phase of the factory. The second phase will depend on the success of the first phase, said the company.

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