UQM Technologies Inc. announces it has signed a Joint Venture Agreement (JVA) with China National Heavy Duty Truck Group Co., Ltd. (CNHTC) and Sinotruk Global Village Investment Limited, a Hong Kong based limited liability company owned by CNHTC. Under the JVA, UQM will acquire a 25% ownership share of the joint venture with CNHTC and its affiliate collectively acquiring a 75% share. UQM has the option to increase its ownership position to 33% in the next one to three years. The initial total capital of the joint venture will be $24 million, with UQM contributing $6 million in three installments during the next year. UQM’s funding requirement is contingent on the closing of the Second Stage Investment with CNHTC, in accord with the terms of the Stock Purchase Agreement signed by both parties on August 25, 2017.
The joint venture will be named Sinotruk Qingdao Zhongqi New Energy Automobile Co., Ltd. and will be headquartered in the city of Qingdao, China. The purpose of the JV will be to serve the China market for commercial vehicle E-drives and the global market for E-axles. The annual production capacity which the JV intends to establish is 50,000 systems, and it is anticipated to commence commercial operations in 2019.
“We are very excited to have signed a joint venture agreement with CNHTC,” says Joe Mitchell, President and CEO of UQM. “Our strategy for many years has been to align ourselves with a Chinese partner that would enable us to have a local manufacturing presence in China. This JV agreement gives us the opportunity to manufacture and sell our electric propulsion systems to the largest market in the world for electric vehicles. We believe that our alliance with CNHTC, given their size, strength, and world class reputation in the global commercial vehicle market, combined with UQM’s second-to-none electric propulsion technology, will generate many opportunities for growth.”
Ma Chunji, Chairman of CNHTC, says, “The new joint venture with UQM provides us the best technology to expand our new energy vehicle presence in China. While we do business in over 100 countries, we also look forward to using our partnership with UQM to grow in the global market as well. We look forward to a long and successful relationship with UQM.”
