(Yicai Global) Aug. 29 -- Shares in Rongtai Industry surged by the exchange-imposed limit today after the Chinese auto parts maker said it will supply new energy vehicle parts to auto manufacturer BYD in a deal estimated to be worth CNY1.5 billion (USD220 million) over the next five years.

Rongtai’s share price [SHA:605133] surged 10 percent to close at CNY36.30 (USD5.25). The stock has soared more than two-and-a-half times since major Chinese stock indexes hit a low point in April, and is now close to the highest it has been since it listed last February.

Rongtai, which counts German auto makers Volkswagen, Audi and BMW among its clients, will supply motor housing products to BYD’s all-electric vehicle development platform in batches from 2023, the firm said on Aug. 26, citing an agreement it had signed with a parts procurement company owned by Shenzhen-based BYD.

The life cycle of the product is expected to last five years with average sales of CNY300 million (USD44 million) a year, the Yangzhou, eastern Jiangsu province-based company said, without mentioning the procurement volume.

The parts are likely to be for BYD’s new ‘Seal’ marque, which is due to start deliveries this month. It is the first model produced by the E3.0 electric vehicle development platform, which is dedicated to the development of all-electric vehicles including its new ‘blade-like battery.’

With a pre-sales price of between CNY21.2 million (USD3 million) to CNY28.9 million, the medium-sized pure electric sports car will be in direct competition with US electric car giant Tesla’s Model 3.

Editor: Kim Taylor