Speaking at an industry forum, company President Zhu Fushou said a deal with Peugeot-Citroen needed to have "mutual benefit."
"If we think a deal has mutual benefit we will proceed. If not, we won't," Zhu said.
"Business cooperation between companies including merger and acquisitions is part of normal business exchanges," Zhu said.
The Wall Street Journal reported Saturday that Dongfeng and Peugeot-Citroen have been in talks for months. A person knowledgeable about the talks said the companies have been discussing Dongfeng buying just under 30 percent of the French company that is struggling to make a profit during a prolonged economic downturn in Europe.
Zhu suggested that partnership deals are slow to develop. "It took many years before Dongfeng and Volvo struck a deal for a commercial vehicle joint venture," he said.
"We will do the right thing at the right time," he added.