Shanghai (Gasgoo)- The9 Limited (The9), an established China-based Internet company, on June 10 announced that it has signed a non-binding Memorandum of Understanding (MoU) with the Development Office of the Hohhot Shaerqin Industrial Zone. Two parties will carry out strategic collaboration on the establishment and development of a NEV joint venture (JV) between Faraday Future (FF) and The9 at the Hohhot Shaerqin Industrial Zone.
In accordance with the MoU, the terms of the MoU will cease to be effective if both parties fail to enter into a definitive agreement within three months.
Pursuant to the MoU, the industrial zone will reserve no less than 5,000mu (around 3 million square meters) of land for the JV program and offer support the JV in obtaining the qualification required for EV production.
(Photo source: The9 Limited)
In the meantime, The9 and Hohhot Shaerqin Industrial Zone will jointly set up a NEV industrial fund with the former and its affiliates contributing no less than RMB500 million (involving the capital used to purchase industrial and commercial lands), and the local government offering no less than RMB1.5 billion (including the subsidy and the capital to build infrastructures and other commercial supporting facilities). The fund is designed to invest in NEV-related projects and operations.
Besides, Hohhot Shaerqin Industrial Zone will also be dedicated to providing new energy projects with RMB4 billion worth of financing by assisting local industry funds banks in jointly offering interest-free, discounted interest or low interest loans.
“The support from Hohhot government will greatly help us introduce FF's high-end technology into China, and produce and sell intelligent EVs in China's market. We are ambitious to make positive contribution to the development of China’s new energy industry,” said Zhu Jun, CEO of The9.
FF on March 25 announced that it had signed an agreement with The9 to form a JV to manufacture, market, distribute, and sell luxury intelligent EVs in China. This also marked a key first step for FF to officially launch its dual-home-market and dual-brand strategy in both China and the US.
Under the agreement, The9 would contribute capital of up to $600 million to the JV in three installments, and FF would make in-kind contributions to the JV, including FF's use rights to a piece of land located in China for luxury EV manufacturing and an exclusive license to manufacture, market, distribute and sell FF's new brand V9 model and potentially other future car models in China. The expected annual production capacity of the JV is 300,000 cars, and the first pre-production car is expected to roll off the production line in 2020.
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