Ford Motor Co. said it will explore setting up a joint venture to produce electric vehicles in China with Anhui Zotye Automobile Co. as manufacturers step up their investments in lower-emission cars in the world’s biggest auto market.
The proposed equally owned joint venture will sell EVs under a new local brand, with details to be announced at a later date pending a final agreement and regulatory approvals, Dearborn, Michigan-based Ford said in a statement on Tuesday.
Automakers are accelerating their investments into electric vehicles to meet stricter emission and fuel-economy rules set to take effect in major markets. China is implementing a cap-and-trade framework next year that will penalize carmakers that don’t meet fleet-based limits through fines or purchase of credits.
Ford has said it plans for 70 percent of all of its vehicles sold in China to have electrified powertrain options by 2025. The automaker currently has joint ventures in the country with Chongqing Changan Automobile Co. and Jiangling Motors Corp.
The company expects the market for new-energy vehicles in China to grow to six million units per year by 2025, of which about four million vehicles will be all-electric. Deliveries of such vehicles rose 53 percent to 507,000 units in 2016, according to the China Association of Automobile Manufacturers.
Ford’s plan follows that of Volkswagen AG, which received approval in May for a new joint venture to produce electric cars. Daimler AG and BMW AG also have electric car brands under their partnerships with BYD Co. and Brilliance China Automotive Holdings Ltd. Volvo Car Group plans to offer only hybrid or fully battery-powered motors on every new model rolled out as of 2019.
Zotye Auto, based in China’s Anhui province, sold more than 16,000 all-electric vehicles in the first seven months of this year, an increase of 56 percent, according to the statement.
Report courtesy Bloomberg