(ATF) One of China's biggest construction machinery manufacturers said it has agreed to invest in a 5.5 billion yuan ($843 million) new energy vehicle (NEV) project in the eastern Chinese city of Xuzhou.
Xuzhou Construction Machinery Group (XCMG) said the project would focus on research, development, production and sales of NEVs, batteries, electric motor control systems and other parts, the company said in a statement on Sunday.
The first phase of the venture with Tsingshan Holding Group, the world's biggest manufacturer of stainless steel, would involve a 2.5 billion yuan investment with projected annual sales proceeds of 10 billion yuan, XCMG said.
The statement did not reveal any details of the companies' respective investments, or how many vehicles, batteries or parts it aims to produce. Tsingshan is also a major nickel producer and has an Indonesian venture producing battery-grade nickel chemicals.
XCMG has been eager in recent months to show off its advanced technology. It recently delivered a 90-tonne mining excavator to Brazil and staged an event there showcasing its range of intelligent autonomous machines. The event last month marked XCMG's entry into the Brazilian mining equipment market,.
"Mining equipment is an emerging pillar of XCMG and an important area for the company to achieve its strategic goals," said Wang Yansong, a vice-president of XCMG and president of XCMG Brazil. "XCMG will seize opportunities in the Brazilian mining market to provide comprehensive, intelligent construction solutions for the industry that are safe, efficient and customer-centric."
Earlier this month, XCMG said it had sold $306 million worth of super cranes to the Chinese domestic market. Its XCA1600 model, which can lift 95 tonnes, is designed for wind power plant construction projects.
XCMG is headed by Wang Min, an outspoken business leader who last year blamed China's local governments for rising loan and bond defaults. “The fall of state firms isn’t just a result of bad management, unclear strategy and inadequate entrepreneurship,” Wang said in an interview with the Financial Times in November. “It also has to do with government mismanagement that puts [unreasonable] performance targets on these companies.”
With reporting by Reuters