The United States' Federal- Mogul (FM) Company, the leading bearing producer in the world, has signed contracts to join with the Shanghai Hezhong Automobile Components Corp. to set up a bearing company in Shanghai, China's largest industrial city.

The joint venture is being initiated with 20 million US dollars of investment, 60 percent of which is from FM.

The new company is the largest of its kind in China, and expects annual sale of bearings, bushings, and thrust washers to rise from the current 13 million to 25 million units by the year 2004.

It is the sixth joint venture in China funded by FM.

Federal-Mogul provides automobile parts for a number of big- name auto makers including General Motors, Ford, and Volkswagen.