(Yicai Global) Aug. 27 -- Chinese power battery behemoth Contemporary Amperex Technology will join with three partners to co-invest CNY2 billion (USD280 million) to jointly develop a magnesium alloy project to achieve further lightening of new energy vehicle materials.

A joint venture company will be set up to take charge of the project's implementation, and the trio have already penned a corresponding investment framework agreement, Guangdong-based Dongguan Eontec, one of the partners, said in a statement yesterday.

Ningde, Fujian province-based CATL, Dongguan Eontec, which has the technology to process magnesium alloy, Fujian-based Sanxiang Advanced Materials, a firm with magnesium resources in Ningde and the technology to process the element, and auto parts processor Jiangsu Vansun Group, or their subsidiaries, will contribute 30 percent, 25 percent, 25 percent and 20 percent of the investment, respectively, to form the JV firm in the port city of Ningde.

The project will unfold in stages, with first-phase investment of CNY500 million (USD70 million), per the statement, which omitted details such as the first stage's estimated commissioning date and the targeted products' type and production scale.

Magnesium alloy has a density 33 percent and 77 percent lighter than aluminum alloy and steel and possesses vibration reduction, heat dissipation, anti-electromagnetic interference and excellent casting and processing performance qualities, the statement explained, adding aerospace and electronic communications are also its potential markets, in addition to the auto sector.

The parties' business strengths combined with Ningde's rich NEV industrial chain resources will build up a first-class magnesium alloy producer, according to the statement.

Editor: Ben Armour