1/24/97 -- 5:41 PM


TUSCALOOSA, Ala. (AP) - Porsche confirmed Friday that talks with Mercedes-Benz about producing a sport utility vehicle in Alabama had broken down.

The German companies had for months discussed the idea of making a Porsche version of Mercedes' new sport utility vehicle in Tuscaloosa County, where Mercedes is set to begin production soon at its first U.S. assembly plant.

``The sport-utility venture that was planned with Mercedes is not going to happen,'' said Porsche spokesman Bob Carlson in Reno, Nev. ``It's off with Mercedes.''

The head of the Mercedes project said the decision was mutual.

``The profit would not be enough for both partners,'' Andreas Renschler, president of Mercedes-Benz U.S. International, told The Tuscaloosa News in Friday's editions.

Production begins this month on Mercedes' M-class vehicle, which will go on sale this fall with a price starting in the mid-$30,000 range. Some reports estimated the price of a Porsche-Mercedes vehicle around $60,000, placing it in a range dominated by Land Rover.

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