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Daimler's EV sub-brand will be named EQ after all.

Mercedes-Benz parent company Daimler has settled a dispute with China's Chery over the use of the name EQ.Last March, Chery sued Daimler in a Chinese court over its upcoming EQ sub-brand, which will focus largely on electric mobility and autonomous technology. The company argued the sub-division's name was too similar to that of its own electric-oriented brand, which is called eQ.

Chery -- which registered the name well before Daimler -- will continue to sell eQ-badged cars in China in the foreseeable future. It also retained the right to add a number as a suffix, e.g. eQ2, eQ 3, and so on.

Daimler was granted the right to use the name on the condition that it's written using only capital letters. Instead of a number, it's allowed to add a letter as a suffix, e.g. EQC, EQ-E, EQ S, etc.

"If [Daimler's EQ brand] entered the Chinese market, it would impact our trademark rights. Mercedes-Benz EQ and our eQ are extremely similar. Their product is also an electric car," Chery argued when it sued Daimler. So far, there's no indication that Daimler will need to rename its cars in China.

The dispute was settled out of court. Daimler hasn't revealed how it persuaded Chery to change its mind.

Note: 2016 Mercedes-Benz Generation EQ concept pictured. Photos by Ronan Glon.