SAIC, which operates car ventures with General Motors and Volkswagen AG, is considering the sale of assets of Shanghai Huizhong due to its weak sales, industry observers say.

Shanghai Huizhong sold a total of 10,000 units over the past 10 years, according to the 21st Century Business Herald. By contrast, SAIC has sold nearly 2 million light vehicles in the first seven months of 2010.

"Discussions with Sinotruk group and Weichai to sell the heavy truck assets of Huizhong are still ongoing," said Xiao Guopu, vice president of SAIC Motor. "I don't see any major problems for the deal to go through."

Xiao made his remarks on the sidelines of an industry forum in the southwestern city of Chengdu. He did not name a preferred buyer for the assets or elaborate on the value of the deal.

A foothold in Shanghai is important for both Weichai Power and Sinotruk group, which are competing for a larger share of China's truck market, analysts said.

Weichai Power is based in the city of Weifang, while Sinotruk is based in the city of Jinan. Both cities are located in Shandong province on China's eastern coast.

Weichai once was a subsidiary of Sinotruk, but the two state-owned companies split in 2006 and are now rivals.