Magna Announces Massive Electric Vehicle Partnership with Chinese Automaker
As more automotive companies get involved with the production of electric vehicles, a Canadian manufacturer is looking to the most populous country in the world as a main customer.
Magna has announced two new joint ventures with Beijing Electric Vehicle Co. (BJEV) to both manufacture vehicles as well as engineer electric vehicles. BJEV is the electric vehicle subsidiary of the BAIC Group, a top-three domestic car producer in China.
The Aurora, Ontario-based Magna unveiled the new partnerships today in Nanjing. Over the next months, the two companies will work with local regulators to implement binding agreements to govern the operations of both organizations.
“These joint venture operations mark a historic milestone for Magna,” said Don Walker, Magna’s CEO. “For the first time, we will be providing our customers with cars engineered and built outside our complete vehicle manufacturing facility in Graz, Austria. It’s a unique capability for Magna, especially with our ability to produce vehicles with conventional, hybrid and electric powertrains, and we are excited to bring it to a market like China where there is tremendous opportunity.”
Magna is expected to take control of an existing BAIC facility in Zhenjiang and production of the first electric vehicles will begin in 2020. That plant can manufacture up to 180,000 cars per year once it is fully operational. To compare, Tesla—perhaps the most well-known electric vehicle manufacturer—delivered just over 100,000 vehicles in 2017.
There is also a possibility that the electric vehicle engineering Magna delivers to BJEV could be offered to other customers.
“From a strategic point of view, the establishment of the JVs will benefit both Magna and BAIC to further strengthen our business growth in China”, said Xu Heyi, chairman of BAIC Group. “Based on an open and sharing platform, we will jointly develop and manufacture premium smart electric vehicles, bringing the clean energy vehicle industry to the next level.”
Magna has already done a lot of work within China and has a deep history of working with manufacturers from the country. In April, Magna first announced they would be developing next-generation electric vehicle tech together. There is an increased push for manufacturers in China to produce electric vehicles as automakers must have a new-energy vehicle score of at least 10 per cent starting in 2019, rising to 12 per cent in 2020. That score is tied directly to the production of various types of zero- and low-emission vehicles.
Earlier this year, Magna announced that they would join forces with Lyft and inject $200 million to develop self-driving car technology. Right now, Magna is one of the few worldwide companies capable of level four self-driving technology—one level below the highest-possible grade.
