Shares of Beiqi Foton Motor and Contemporary Amperex Technology rose after the Chinese commercial vehicle giant said it has joined hands with the world’s largest battery maker to develop a business renting batteries for new energy trucks.
Foton Motor [SHA: 600166] ended 8.4 percent higher today at CNY2.98 (43 US cents) a share, while CATL [SHE: 300750] rose 2 percent to CNY400.02 (USD57.20).
The pair will set up a 50:50 joint venture with a registered capital of CNY200 million (USD28.7 million), BAIC Group-backed Foton Motor announced.
The JV will help enhance the market competitiveness of Foton Motor’s new energy products, promote new vehicle sales, and open up the new energy operations market, the Beijing-based company said, without specifying the JV’s business or profit model.
The cost of a battery accounts for a relatively large part of a new energy vehicles’ total cost. Battery leasing can reduce the initial investment for buyers, boosting vehicle sales.
CATL launched its battery swap brand Evogo in January. Initially trialed in 10 Chinese cities, it is expected to have 30 swapping stations by year-end. Evogo’s first two partners were FAW Group unit Bestune and Dongfeng Peugeot-Citroen Automobile, a Chinese-French JV.
Foton Motor is a supplier and service provider of logistics vehicles, such as heavy trucks and buses, and core components, including engines and transmissions. It has launched a variety of new energy trucks.
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