Manufacturing News

Dongfeng to jointly develop green cars with Saab owner

Dongfeng Motor Group Co. and National Electric Vehicle Sweden, which bought bankrupt carmaker Saab in 2012, signed an agreement to jointly develop green cars, the state-owned Xinhua news agency reported.

The agreement will help Dongfeng sell its brand of cars through the NEVS dealer network in Europe and the United States, and also meet European legal and technical requirements, Xinhua reported.

The report did not give financial terms of the deal between the Chinese automakers.

The deal is another step forward for NEVS after financial problems led it to stop production of Saab cars in Sweden last year. Defense contractor Saab AB, from which Saab Automobile was created in 1990, has also prohibited use of the brand name.

The agreement will also allow NEVS' planned factory in Tianjin to draw on the massive supplier network of Dongfeng, China's second largest automaker.

NEVS announced in June that it broke ground on a factory with a potential capacity of 200,000 cars as well as a research and development center, with two Chinese partners pledging to invest 1.2 billion yuan ($187.68 million).

It said the project would focus specifically on "new energy vehicles", a Chinese term for electric and highly electrified vehicles.

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