GAC AND BYD ESTABLISH JOINT VENTURE
Chinese vehicle manufacturers have decided to form a joint venture in the alternative energy vehicle area targeting at co-operation with regard to bus and car production. BYD will be responsible for the new energy buses and Trumpchi will be focusing on passenger vehicles.
The joint venture company, GAC BYD New Energy Bus Co. Ltd. (shorted as “GAC BYD”), mainly targets at the Guangzhou new energy bus market, while GAC Trumpchi will try to develop alternative energy passenger vehicles.
The first step was made on August 5th 2015, when BYD released announcements that the Board had passed an Act on Establishing GAC BYD New Energy Bus Project and agreed to sign a Shareholder Agreements on Establishing the New Energy Bus Project. The two sides, BYD and GAC, co-invest to establish GAC BYD with a share proportion of 51% and 49% respectively. The joint venture enterprise has a registered capital of 300m RMB and receives a first-stage investment of 120m RMB, all in cash, which is used for prior-stage project construction. The second-stage investment will be cash by BYD, together with cash and shares of GAC Bus by GAC.