(Yicai Global) Jan. 30 -- FAW Car Co., maker of China's first luxury car brand Hongqi, will cooperate with Hunan Corun New Energy Co., a hybrid power system developer, to make new hybrid electric vehicles. The companies plan to produce and sell 150,000 vehicles between 2019 to 2021 in China's increasingly competitive and crowded new electric vehicle market.

Both parties signed an agreement yesterday to cooperate in products, technologies, capital and shared travel services, said a statement from FAW Car [SHE:000800]. They plan to apply Hunan Corun's [SHA:600478] hybrid power system and key parts in some models of Faw and develop both hybrid electric vehicles and plug-in hybrid electric cars, it added.

Under the agreement, both companies will first apply Corun's hybrid power system in Besturn models and develop a customized HEV and start to sell next year. The model will first be operated and sold in public transportation. They plan to produce and sell 150,000 vehicles from 2019 to 2021, with vehicles made in 2019 and 2020 to be first used in Corun's market promotion in public transportation.

Corun previously formed partnership with several Chinese carmakers to produce new models fitted with its hybrid power system. It also applies financial methods such as financial leasing to promote and sell HEVs using its technologies in China's transportation system, including taxis, car-hailing services and buses.