The German automaker has confirmed that it will be manufacturing 100,000 all-electric vehicles per year with the Chinese automobile company JAC Motors.

Volkswagen joins Ford and GM

We knew that Volkswagen was exploring a joint venture to make electric vehicles in China, and now it’s official: the German car company confirmed that the Chinese government has approved its joint venture with Anhui Jianghuai Automobile Group, also known as JAC Motors.

China has strict rules regarding foreign manufacturers and foreign investments, requiring each company to form a local joint venture with a domestic manufacturer. Ford and GM have gone through the process, with Changan Ford and SAIC GM already producing electric vehicles for the Chinese market and abroad.

Reportedly worth $740 million, the newly-announced partnership between Volkswagen and JAC Motors is exclusively for the production of electric vehicles. According to a JAC Motors stock exchange filing, the two companies will build 100,000 pure battery electric vehicles annually.

Although Volkswagen says details have not been finalized and therefore the production timeframe has not been set yet, China’s zero emission vehicle mandate requires that 8 percent of new car sales be zero-emission vehicles in 2018, going up to a whopping 12 percent in 2020. So it’s likely that we will see the official production start sooner than later. Given Volkswagen’s current roadmap, according to which new electric vehicles won’t hit the North American and European markets until 2020, it is also likely that China will see new electric vehicles from Volkswagen before the rest of the world.

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