Guangzhou Automobile Group (HKG:2238) and FAW Group signed a strategic cooperation framework agreement to deepen cooperation as China's auto industry moves toward greater consolidation, Reuters reported Tuesday.

Under the agreement, GAC's controlling shareholder Guangzhou Automobile Industry Group and FAW will explore technology development and resource sharing to improve operational efficiency and supply-chain resilience, the report noted.

The agreement follows GAC's announcement on Monday that FAW is set to become its second-largest shareholder through GAC's acquisition of a 50% stake in FAW Toyota.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)