City are afraid they have been leapfrogged in attempts to sign the wantaway Chilean superstar
The Chilean striker is desperate to leave Arsenal and will be free to speak to European clubs in January as he is out-of-contract next summer.
Alexis Sanchez is still not up to full strength after his elongated break from pre-season
Alexis Sanchez was in action last night for Arsenal in their Carabao Cup clash with Doncaster
By contrast, Man City must wait until summer to speak to Sanchez.
Pep Guardiola was confident the 28-year-old wanted to join City, despite a failed £60m pursuit in the previous transfer window.
But Paris Saint-Germain are ramping up their interest and want him to partner Neymar and Kylian Mbappe upfront.
Sanchez met with PSG chiefs in the French capital this summer, where they discussed a potential transfer.
He demanded a staggering £400,000-a-week, which the Ligue 1 side admitted they could not afford to pay.
But Unai Emery’s team did tell him they would hand him a hefty signing on fee and top City’s offer of £275,000-a-week.
It is understood PSG will offload Edinson Cavani, who recently had a bust-up with Neymar over a free-kick to make way for Sanchez.
Pep Guardiola has been interested in re-uniting with Alexis Sanchez
Paris Saint-Germain bought Neymar for a world record fee in the summer but the Brazilian has fallen out with Edinson Cavani
Kylian Mbappe was also bought by Paris Saint-Germain
A source revealed: “City’s pursuit of Alexis could be in trouble. Pep is sure he wants to join the club but Paris are sniffing.
“They still have the funds to sign him and can beat City’s wage offer. They will also pay him a huge signing on fee.
“Sanchez can talk to European clubs in January and sign a pre-contract. He’s in a very strong situation.”
PSG have already shelled out a world record £198m to Barcelona for Brazilian superstar Neymar this year.
They also took Mbappe on a season-long loan from Monaco, with a commitment to buy him for £166m next summer.
Neymar proves he really is magic after appearing from thin air to take ball from Cavani for PSG penalty
Sanchez is desperate to quit the Emirates, with Real Madrid even showing an interest in snapping him up.
But City are still hopeful of tempting Arsenal with a £20m offer in January before his deal runs out.
Arsene Wenger is understood to have accepted he is leaving, but wants Monaco ace Thomas Lemar as a replacement.
Manchester United also threw their hat into the ring this week by offering Sanchez a £25m signing on free to join them.
Alexis Sanchez laughs from the bench after Alexandre Lacazette misses chance at Chelsea