and the southern Chinese megacity of Shenzhen signed a strategic cooperation agreement Friday to invest RMB 5 billion ($770 million) in a parts factory, the Shenzhen Economic Daily reported.

The plant will be mainly used for the research and development, production, and manufacturing of core products such as auto parts and related supporting industries, the report said.

The project will cover an area of nearly one square kilometer and will be built in two phases, with an annual output value of about RMB 10 billion when it is all completed and in production.

The signing ceremony was attended by Shenzhen Mayor Qin Weizhong and BYD Chairman and President Wang Chuanfu, indicating the importance both attach to the project.

At a time when its new energy vehicle sales are growing rapidly, BYD is actively expanding its parts production capacity.

On August 3, BYD established a new battery company in Anhui province, which covers battery manufacturing and sales, new material technology research and development, and electronic specialty material manufacturing, sales, and R&D.

The company signed an investment cooperation agreement with Changchun Municipal Government of Jilin Province in northeast China and FAW Group on Wednesday on July 15 for a new energy power battery project, which will establish a power battery production base in Changchun.

BYD sold 57,410 vehicles in July, with cumulative sales of 304,099 units this year, up 60.04 percent year-on-year.

BYD's new energy vehicle sales in July were 50,492 units, and the cumulative sales this year were 20,507 units, up 170.62 percent year-on-year.