Greentech Lead Asia: Geely Holdings has signed a framework of cooperation with Kandi Technology Corporation to work together in a new joint venture company involved in the research and development, production, investment, and marketing of electric vehicles.
The new company will be formed with Geely’s subsidiary, Shanghai Maple Auto, and Kandi, an electric vehicle manufacturer. Initial invested capital touches 100 million yuan, with each party taking a 50 percent share in the new company.
Both parties will be equally involved in the new joint venture by playing off each other’s strong points in the areas of electric car development and car production.
Geely has been researching electric vehicles for a number of years and has accumulated a great amount of experience in this area. The company is engaged in the research and development, production and sales of automobiles. Â Geely has the capacity to produce 600,000 vehicles, engines and gearboxes per year.
With increased importance placed on the development of new energy vehicles in China by the government at all levels of governance, and with consumers’ ever growing environmental concerns, Geely and Kandi are aiming to bring mass market, affordable cars to the markets.
In initial stages, the new company will focus on developing electric vehicle solutions for the public transport system in the Hangzhou area, and will later expand to other areas, including electric automobiles.
Hangzhou was selected as an electric vehicle test city along with 24 other pilot cities in China to better understand infrastructure and consumer needs during the transition from traditional gasoline engines to new energy products, and as such the city has already invested considerable amounts of funds into developing electric vehicle infrastructure around the city, making it a strong starting point for the new joint venture company.
Geely’s existing electric vehicle range has already entered into the Ministry of Information and Technology’s list of supported electric vehicles, which further strengthens the central government’s support for Geely’s products.
Hu Xiao Ming , the General Manager of the new joint venture, remarked, “New energy vehicles are being supported by city, provincial and state-level leaders, therefore enterprises in China have a responsibility to provide reliable and convenient products and services, as well as new business models.”