DaimlerChrysler has said it hopes to soon finalise an agreement to produce medium and heavy duty trucks in China.

A spokesperson for the company told AFX News that it has been in discussions for some time with Beiqi Foton Motor to co-operate on truck production.

Trading in Beiqi Foton shares was suspended from today, pending an important announcement.

Local Chinese press reports have suggested that DaimlerChrysler is expected to buy a 24% stake in Beiqi Foton.

But AFX noted that because of Chinese government policy that foreign vehicle manufacturers may only set up two passenger car joint ventures and two commercial vehicle joint ventures at any one time, a new deal would mean DaimlerChrylser would have to end one of its existing joint venture partnerships in China. This would most likely be Yaxing Benz.

DaimlerChrysler has a commercial vehicle venture with Fujian Motor Industry and Taiwan-based China Motor, and another with Jiangsu Yaxing Motor & Coach.