Toyota unveiled at the Geneva Motor Show its Yaris HSD concept, which represents the first down-sizing of Toyota's Hybrid Synergy Drive® technology. Reuters

Toyota Motor Corp. is negotiating a deal to license its expertise in hybrid vehicles and to supply car parts to its Chinese partner, FAW Group Corp by 2012.

Toyota, Japan's top carmaker plans to offer the technology necessary for making vehicles powered by gasoline and electricity as well as motors, batteries and other parts for use in the FAW Group's hybrids due to be marketed in 2013 or later, various Japanese media outlets said.

The proposal is aimed at increasing Toyota's presence in the Chinese market, where the company is lagging behind such competitors as Volkswagen AG and General Motors Co.

The proposed licensing deal could become Toyota's fourth involving hybrid technology and the first with a Chinese carmaker. The Japanese company earlier made such arrangements with Nissan Motor Co., Ford Motor Co. and Mazda Motor Corp, reports said.

Toyota is also in similar talks with Daimler AG, the reports added. Late 2005, Toyota began manufacturing its Prius hybrid in China through a joint venture with the major Chinese carmaker.