Magna and BAIC to form two JVs to engineer and build premium EVs for customers in China; first production in 2020
Magna intends to form two new joint ventures with Beijing Electric Vehicle Co. Ltd (BJEV)—a subsidiary of the BAIC Group for electric cars—for the engineering and complete vehicle manufacturing of electric vehicles.
Over the coming months, Magna and BJEV will work with authorities to implement legally binding joint-venture agreements which will govern the operations of these two joint ventures.
The Zhenjiang facility where Magna and BJEV plan to engineer and build electric vehicles for the Chinese market.
The engineering and manufacturing joint ventures are expected to take over an existing BAIC manufacturing facility in Zhenjiang, Jiangsu Province, where the first production vehicles are planned for 2020. The plant has the capacity to build up to 180,000 vehicles per year.
The joint ventures will also be set up to offer engineering and complete vehicle manufacturing capacity to other potential customers.
These joint venture operations mark an historic milestone for Magna. For the first time we will be providing our customers with cars engineered and built outside our complete vehicle manufacturing facility in Graz, Austria.
It’s a unique capability for Magna, especially with our ability to produce vehicles with conventional, hybrid and electric powertrains, and we are excited to bring it to a market like China where there is tremendous opportunity.—Don Walker, CEO of Magna International Inc.
From a strategic point of view, the establishment of the JVs will benefit both Magna and BAIC to further strengthen our business growth in China. Based on an open and sharing platform, we will jointly develop and manufacture premium smart electric vehicles, bringing the clean energy vehicle industry to the next level.—Xu Heyi, Chairman of BAIC Group
In April 2018, BAIC Group and Magna announced they will jointly develop a next-generation smart electric vehicle architecture for the Chinese market. (Earlier post.) It is expected that this vehicle architecture will be transferred to the engineering joint venture and will form the platform of the new electric vehicles to be launched in the joint venture.
China is currently the world’s leading market for electric mobility. By 2020, the number of all-electric cars on China’s roads is forecasted to reach around five million.
Both joint ventures are subject to a number of conditions including agreement on final joint venture agreements and obtaining all necessary regulatory approvals.