BEIJING - BAIC Group, China's fifth-largest auto group, has signed an agreement with Russian AMS Group to produce commercial vehicles in Russia.

This will be the first Chinese auto factory built in Russia after the financial crisis. The joint venture is estimated to cost $176 million, and BAIC and the AMS group will hold a 50 percent stake respectively.

The production capacity is expected to reach 60,000 units by 2015 when the factory grows to its full fledge. In stage one, 20,000 trucks will be produced by 2015. Products will be assembled from complete knocked-down pieces imported from China. The product line covers a series of trucks, sold under the name of BAW.

The cooperation between BAIC and AMS dates back to 2003, when BAIC sold spare parts to AMS Group. BAIC is currently selling nearly 10,000 trucks in Russia every year.

Russia is one of the most important emerging markets for major truck manufacturers in the world. The Russian government provides a series of favorable policies to boost the auto investment.

"The cooperation is part of BAIC's world expansion," said Xu Heyi, president of BAIC. "We hope that the cooperation can extend to more areas such as SUVs, sedans and other vehicles."