BEIJING (Reuters) - Germany's Volkswagen AG (DE:VOWG_p) and Anhui Jianghuai Automobile Group (JAC Motor) have received approval from Chinese regulators to form a joint venture to make electric vehicles, the two automakers said on Monday.
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.
A VW spokesman confirmed the approval but said certain administrative procedures still needed to be completed for a joint venture contract to be signed with JAC Motor.
Volkswagen, China's largest foreign automaker, has pledged to rapidly develop a range of electric vehicles as the Chinese government aggressively promotes the segment as a way to cut intense smog in much of the country.
VW already has joint ventures with China FAW Group Corp [SASACJ.UL] and SAIC Motor Corp Ltd in the country.
The has company previously said it aims to sell 400,000 "new energy vehicles," a category which includes pure electric and plug-in petrol-electric hybrids, in China by 2020 to meet strict Chinese fuel economy and emissions regulations, with electric vehicles made with JAC Motor coming in addition to that figure.