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Auto parts firm Magna plans electric vehicle joint ventures with Chinese company

Last Updated Jun 18, 2018 at 12:20 pm EST

A Magna International Inc., sign is silhouetted at the company's annual general meeting in Toronto on May 10, 2013. Magna International Inc. has signed a deal to form two new joint ventures with Beijing Electric Vehicle Co. Ltd. for complete vehicle manufacturing as well as engineering of electric vehicles. THE CANADIAN PRESS/Nathan Denette

AURORA, Ont. – Magna International Inc. says it will form two new joint ventures with a Chinese company to engineer and build electric vehicles.

The Ontario-based auto parts company and Beijing Electric Vehicle Co. Ltd., a subsidiary of the BAIC Group, are expected to take over an existing BAIC manufacturing facility where the first production vehicles are planned for 2020. The plant has the capacity to build up to 180,000 vehicles per year.

Magna says the engineering and manufacturing joint ventures will also be set up to offer engineering and complete vehicle manufacturing to other customers.

The plans for the joint venture follow an agreement in April that saw BAIC Group and Magna agree to develop smart electric vehicle architecture for the Chinese market.

It is expected that this work will be transferred to the engineering joint venture and will form the platform of the new electric vehicles to be launched by the joint venture.

Both joint ventures are subject to a number of conditions and Magna says it will work with authorities to implement legally binding joint-venture agreements over the coming months.

Companies in this story: (TSX:MG)