The project, with a total investment of RMB 12 billion, has a planned annual capacity of 30 GWh.
(Image credit: Dongfeng Motor)
Dongfeng Motor's joint venture with battery maker Sunwoda has started construction of a power battery project that is expected to lay the foundation for the auto giant's stable battery supply in the future.
The power battery production base project in Yichang, Hubei province, officially started construction on October 30, after the signing of the contract was completed in September, according to an announcement made by Dongfeng on Monday.
The project has will have total investment of RMB 12 billion ($1.639 billion) and a planned annual capacity of 30 GWh of power batteries.
The project will be built in two phases, with the first phase having a planned annual capacity of 20 GWh.
After full production, the project will have the functions of R&D, production and sales of products including battery cells and modules.
Its annual output value is expected to exceed RMB 24 billion and will provide about 3,500 jobs, according to Dongfeng Motor.
On June 17, Dongfeng Motor and its parts subsidiary, Dongfeng Hongtai, entered into a joint venture agreement with Sunwoda Electric Vehicle Battery Co Ltd (Sunwoda EVB) to establish a joint venture company to research, develop and produce electric cells, modules and related components.
The joint venture has a registered capital of RMB500 million and the three companies own 35 percent, 14 percent and 51 percent of the equity respectively.
Sunwoda was founded in 2008 and listed on the ChiNext stock market, China's Nasdaq-style board for growth enterprises, in April 2011. Its main business is consumer batteries, but its power battery business has been growing rapidly in recent years.
Sunwoda's revenue in 2021 was RMB 37.4 billion, up 25.82 percent year-on-year. Its power battery business generated RMB 2.93 billion in revenue in 2021, a year-on-year increase of 584.67 percent.
In September, Sunwoda ranked sixth in China with a power battery market share of 2.52 percent, according to the China Automotive Battery Innovation Alliance (CABIA).