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JAC Motor to form a joint venture with Volkswagen AG to make EVs, receives approval from Chinese regulators

According to a report by Reuters, Anhui Jianghuai Automobile Group (JAC Motor) has received approval from Chinese regulators to form a joint venture with German automaker Volkswagen AG to make electric vehicles.

Volkswagen is China’s largest foreign automaker in China and already has joint ventures with China FAW Group Corp and SAIC Motor Corp Ltd. Volkswagen Group China is the most successful international partner in China’s Automotive Industry. It started its connection with China as early as in 1978, and has been taking the leading position in the Chinese automotive market for more than 25 years.


Chinese government has given guidance that automotive joint ventures are necessary for foreign automakers to do increased business in China.The National Development and Reform Commission (NDRC), China’s top state planner, gave a green light to JAC and VW to build 100,000 pure battery electric vehicles annually in a project worth 5.1 billion yuan ($740 million), according to a JAC Motor stock exchange filing.

Volkswagen AG was from a long time exploring a joint venture to make electric cars in China with a state-run company, part of its aggressive push into electric-vehicle production after it had got mired in emmissions cheating scandal.

China has also been pushing aggresively to move to a greater mix of electrified vehicles and it has been calling on auto manufacturers to sell more electric vehicles to reduce vehicle emissions, as well as China’s dependence on foreign oil. The Chinese government has subsidized charging stations for electric vehicles apart from paying people who purchase electric and plug-in hybrids thousands of dollars’ worth of subsidies.


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