(Yicai Global) May 28 -- Volkswagen has teamed up with Jianghuai Automobile Group to create its first Chinese smart city as the world's largest automaker looks to bring more of its smart vehicle technologies to the biggest auto market on the planet.

VW subsidiary Mobility Asia will lead the project in Anhui's provincial capital Hefei, China's state-backed International Finance News reported yesterday. It penned an agreement with Volkswagen Group China, Jainghuai and the local municipal government yesterday.

The plans fall in line with a China strategy published by Volkswagen last year, which said it would collaborate with local partners and invest EUR15 billion (USD16.8 billion) in electric vehicles, autonomous driving and web-based travel services in the country.

Mobility Asia will build a travel service platform offering ride hailing, smart parking, new-energy vehicle charging and autonomous driving tests, Chief Executive Su Weiming said. It will provide the new partnership with core technical support for smart travel, infrastructure, big data applications, autonomous driving and the Internet of Vehicles. 

Jianghuai, Wolfsburg-based Volkswagen's third-biggest partner in China behind SAIC Motor and the FAW Group, is also joining hands with the auto giant to invest CNY5.1 billion (USD734 million) and build an NEV factory in Hefei capable of producing 100,000 cars a year, which is set to open in 2020.

Editor: James Boynton