(Yicai Global) July 6 -- German automaker Daimler AG and Beijing-based BAIC Motor Corporation Co. signed a new framework agreement to deepen cooperation in their joint venture, Beijing Benz Automotive Co.
The pair signed the agreement yesterday, pledging to inject CNY5 billion (USD735 million) in the joint venture to build a local electric vehicle (EV) production base and a traction battery plant, reported Economic Information Daily. Production of Mercedes-Benz electric cars are slated to commence at Beijing Benz by 2020.
Both companies also intend to collaboratively set up an electric vehicle production base and manufacture and develop electric-vehicle batteries for the Chinese Mercedes-Benz electric model in Beijing. Daimler looks set to be the first international luxury car brand to produce traction batteries in China.
The new strategic framework agreement will bring cooperation between the two companies to a new level, said BAIC's chairman, Xu Heyi. Both sides will integrate related resources to lay the groundwork for localized electric vehicle production. Beijing Benz is poised to become a major electric car production base in China.
China is of pivotal and vital importance to Mercedes-Benz's global EV development strategy by 2025, noted Hubertus Troska, a member of Daimler's board of directors, and chairman of Daimler Greater China. Daimler will step up electric vehicle localization and continuously increase input into EV businesses in China to meet the individual needs of Chinese customers.
Setting up a luxury EV battery plant in China is a key part of Daimler's new-energy vehicle strategy, pointed out Marcus Schaeffer, a member of divisional board of Mercedes-Benz Cars, production and supply chain management, and the plant will be the first one built by Mercedes-Benz outside Germany.