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China FAW to sign pact with Toyota

BEIJING, Aug 28 (Reuters) - China's top auto maker, First Automotive Works (FAW), will sign a cooperative pact with Toyota Motor Corp on Thursday, company officials said.

"First Automotive Works will sign a cooperative agreement with Toyota tomorrow," an official at the Chinese auto giant's Beijing office said on Wednesday, but declined to give further details.

Officials at Toyota's Beijing representative office said the company would hold a joint news conference with FAW in the Great Hall of the People on Thursday.

Japanese financial daily Nihon Keizai Shimbun reported that Toyota and FAW would set up a plant in northern Chinese city of Tianjin to produce 30,000-50,000 units of a remodelled Crown luxury sedan annually for the domestic market.

The plant would begin operation in 2005, the newspaper said.

They were also considering building other models similar to the Camry and the Corolla, two of Toyota's mainstay cars, it said.

Toyota has a joint venture with Tianjin Automotive Industry Corp, which signed a deal in June to sell 50.98 percent of its flagship unit, Tianjin Automotive Xiali Co , to FAW in a landmark alliance aimed at fending off foreign rivals.

Chinese auto makers have been speeding up alliance talks with foreign and domestic firms to cope with rising competition after China's entry into the World Trade Organisation late last year and slashed import tariffs. ($1=8.277 Yuan)