Ford Motor Company and Zotye, the Chinese automaker, announced on Tuesday that they are establishing a joint venture to design, develop, and manufacture electric cars in China. The two companies will create a new brand under the name "Zotye Ford Automobile Co., Ltd." to offer high-quality, affordable electric cars for consumers in China.
The new joint venture is a reflection of the growing popularity of electric cars in China. A government initiative to push electric vehicles has helped sales of such cars to surge in China in recent years. According to the China Association of Automobile Manufacturers, total sales of electric cars - both pure electric and plug-in hybrids - in China reached 507,000 units last year. This marks a 53% increase from 2015, and makes China the world's largest market for electric vehicles.
The Chinese government's push to promote electric cars also includes proposals to ban gas and diesel-powered cars in the country's major cities. This proposed ban would require all vehicles sold in China's cities - which account for about 10% of the country's car market - to be electric by 2030.
Ford's venture with Zotye aims to capitalize on this trend and tap into the fast-growing electric vehicle market in China. Peter Fleet, the head of Ford's operations in the Asia Pacific region, said that the partnership will "deliver a range of stylish and affordable electric vehicles with strong value for money and performance."
Zotye Ford Automobile will leverage the strengths of both companies to jointly design, develop, and produce the vehicles that will be sold under the new indigenous brand. Ford will contribute its global expertise in electric vehicle development and manufacturing, while Zotye will contribute its knowledge of the local market and manufacturing capabilities.
The joint venture will also benefit from China's new regulations that emphasize the development of electric vehicles. The Chinese government has set targets for electric vehicles to make up at least 8% of total vehicle sales by this year, rising to 10% by 2019 and 12% by 2020. These requirements will help to promote the development and growth of the electric vehicle market in China.
The joint venture between Ford and Zotye is expected to produce a range of electric vehicles that are tailored to the Chinese market and meet the growing demand for electric cars among local consumers. Analysists have said that Ford's partnership with Zotye is a good strategy as it will allow the company to avoid some of the issues that other Western automakers have faced in producing electric vehicles for the Chinese market.
The launch of the Zotye Ford Automobile Co., Ltd. brand is expected to be a key driver of growth for Ford in the Chinese market. Despite selling more than one million vehicles in China last year, Ford has been struggling to keep pace with rivals like General Motors and Volkswagen. By partnering with one of China's leading domestic automakers, Ford will have access to the established network that Zotye has developed over the years, which includes manufacturing plants, distribution channels, and service centers across the country.
The joint venture with Zotye represents Ford's latest move into the electric vehicle market following the recent announcement of the company's ambitious plan to invest $11 billion in the development and production of electric cars by 2022. This investment will also include the introduction of hybrid and fully-electric versions of many of Ford's core models - such as the F-150 pickup truck - as well as the launch of new, high-performance electric models.
Overall, the joint venture between Ford and Zotye marks another important step for the American automaker's expansion into the burgeoning Chinese electric vehicle market. By leveraging the strengths of both companies, the new partnership will help to deliver affordable, high-quality electric vehicles that meet the needs and preferences of Chinese consumers.