Ford, China's Zotye Auto plan JV for electric vehicles

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The US automaker Ford Motor is exploring setting up a joint venture (JV) with Chinese firm Anhui Zotye Automobile Co to build electric passenger vehicles in China under a new brand, said Ford on Tuesday.

Ford said in a statement that it had signed a memorandum of understanding with Zotye Auto to build a new brand under which the electric vehicles will be developed, manufactured and sold. Each of the firms will hold a 50-50 stake in the JV, it said.

It did not provide details of financial commitments nor say by when it will take a firm decision on the JV.

The logo of Ford Motor. /Reuters Photo

Ford sees China as the fastest growing market in the world for new energy vehicles (NEV) and forecasts that the segment to grow to six million vehicles per year by 2025, of which approximately four million would be all-electric.

Peter Fleet, Ford Group's vice president and president of Ford Asia Pacific, regarded this as an “exciting next step for Ford in China”.

“Electric vehicles will be a big part of the future in China and Ford wants to lead in delivering great solutions to customers,” he said.

The potential JV with Zotye Auto would represent a deepening of commitment to electric vehicles in China by Ford. In April, it outlined plans to offer by 2025 hybrid or fully electric versions of all models built in China with its domestic joint venture partner, Chongqing Changan Automobile Co., Ltd.

However, it also said at the time that it would take a cautious approach to the market due to uncertainty about consumer interest and government policy.

Some vehicle models of China's Zotye Auto. /Xinhua Photo

Zotye, which Ford described as the market leader in China's all-electric small vehicle segment, sold more than 16,000 all-electric vehicles this year through July, representing a year-on-year growth of 56 percent, it said.

The privately-owned company, which is headquartered in China's coastal Zhejiang Province, also makes sport utility vehicles and cargo trucks. On Monday, it reported a near six-fold jump in first-half profits.

Ford said it would release details about the brand, products and production volumes at a later date, pending a final agreement and regulatory approvals.

Source(s): Reuters