Ford signed a definitive joint venture agreement with Zotye from China to invest a combined investment of US$756 million to build electric cars within the country’s borders. The deal will create a new entity known as Zotye Ford Automobile Co. Ltd, where the two companies will hold equal stakes. Following the Memorandum of Understanding that the companies signed in August earlier this year, this move is no surprise.
Already being established in the Chinese EV market, Zotye has sold 22,500 of its small, all-electric cars as of October 2017. The carmaker’s experience and presence in China will provide an advantage to Ford to penetrate the market more effectively.
However, the Ford-Zotye deal is currently waiting for government approval, since under the Chinese policy, foreign automakers are required to have a domestic partner to manufacture vehicles in the country. Once the agreement is approved, the new brand plans to build a manufacturing plant in the country’s Zhejiang Province. In the meantime, Ford-Zotye brainchild will continue to explore the opportunity to offer new mobility services in China, with the aim of addressing other aspects of transportation.
Given the automaker’s emphasis on urban transportation and innovation, those new services could wind up pertaining to public ride-sharing programs and autonomy, two major trends also sweeping the auto development world.
It is still unclear when the companies will break ground on the manufacturing facility. Ford already has joint venture deals with two other Chinese automakers, however, so it won’t be a matter of the company producing cars in the country for the first time.
Source: Mashable
