SEOUL (Reuters) - South Korea's Myongshin has agreed to build more than 50,000 electric vehicles a year for Chinese venture Future Mobility Corp (FMC) at a closed plant it bought from General Motors (NYSE:GM).
A parts supplier to Hyundai Motor and Tesla (NASDAQ:TSLA) Inc, Myongshin signed a deal on Wednesday to build the electric vehicles for FMC's Byton brand beginning in 2021, the government of Jeonbuk province said in a statement.
The deal comes as made-in-China vehicles exported to the United States are currently subject to tariffs. Sales of cars made in South Korea can avoid those tariffs.
Myongshin bought a factory from GM's local unit for 113 billion won ($94 million) in June after the U.S. carmaker closed one of its four South Korean plants last year.
Myongshin will produce Byton's M-Byte electric SUV in the factory in the southwestern city of Gunsan, the Jeonbuk provincial government said.
The cars will be sold in South Korea and overseas, Park Ho-seok, vice president of Myongshin, told Reuters.
The plant could allow FMC to take advantage of South Korea’s free trade deal with the United States and Europe, as well as the country's electric car supply chain.
Former BMW and Nissan Motor executives co-founded Chinese electric-car venture FMC, which in September 2017 named its brand "Byton".
FMC, the parent company, plans to launch the vehicles in the United States and Europe soon after starting sales in China in 2019.