Chinese car and battery maker BYD is teaming up with a rival car-maker to build a battery giga factory in China— hot on the heels of opening what it said was the “world’s biggest” auto batteries plant in the country.
BYD is forming a joint venture with state-owned Changan Automobile to focus on electric vehicle (EV) battery production at a new plant in southwest China for domestic sales.
The facility will be built in the Chongqing Liangjiang New Area development zone in two stages and have an eventual annual production capacity of 10 gigawatt-hours.
Under the terms of the deal, both sides said they would combine their respective technologies in developing EV hybrids.
Changan will also become a shareholder in BYD’s battery business.
BYD founder and chairman Wang Chuanfu said the cooperation with Changan was the first step towards growing external sales of BYD automotive batteries.
Last year, Chinese battery industry sources suggested BYD could split its vehicle and battery manufacturing businesses, opening the door for it to supply its lithium iron phosphate (LFP) batteries and ternary lithium batteries to the wider market.
Changan currently uses lithium-ion battery tech for its vehicles. In 2015, the company inked a deal for South Korea’s LG Chem to supply batteries for Changan’s next-generation plug-in hybrid electric vehicle.