SHANGHAI -- BYD Co. and Toyota Motor Corp. said on Thursday they planned to set up a joint venture to design and develop electric vehicles as they ramp up efforts to produce zero emissions vehicles.
The two companies said in a statement that they would each invest 50 percent of the capital needed to establish the company, which will be set up next year and be based in China. The companies did not disclose the value of the venture.
Widely considered a late comer in embracing battery EVs, compared with rivals including Nissan, Toyota had flagged in June that it aimed to generate half of its global sales from EVs, including gasoline hybrids, by 2025, five years ahead of schedule.
The venture aims to develop vehicles that run solely on batteries, rather than plug-in hybrid or gasoline-electric vehicles which also have a combustion engine.
In July, the companies said they would develop battery-electric sedans, SUVs and crossovers, which would then be sold under the Toyota brand in China before 2025.
Toyota also develops hydrogen fuel-cell vehicles and plans to launch fuel-cell models with its Chinese partners, Guangzhou Automobile Group and FAW Group , in China, as the world's largest auto market increases support for fuel-cell vehicles.
Shenzhen-based BYD, backed by Warren Buffett, whose models include the Song series and the Qin plug-in hybrid electric vehicle, aims to move to completely electric-powered vehicles. However, its profits are expected to drop this year as China cuts subsidies on EVs.