Shanghai (ZXZC)- Geely Technology Group inked an agreement with Ganzhou Municipal Government and Ganzhou Economic and Technological Development Zone Management Committee on March 13 for building a power battery manufacturing base in Ganzhou, a prefecture-level city in China's Jiangxi province.

Photo credit: Geely Technology Group

The company said via its WeChat account it plans to plow 30 billion yuan ($4.612 billion) in a power battery production factory in Ganzhou with a designed capacity of 42GWh per year. The project will be constructed in two phases. Involving an investment of 8.5 billion yuan ($1.307 billion) and covering an area of 500 mu (around 333,000 square meters), the first phase will feature an annual capacity of 12GWh. The other 30GWh capacity will be built for the second phase that covers 1,000 mu (around 667,000 square meters).

China aims to increase the annual sales of new energy vehicles (NEVs) to 6 million units by 2025, according to the Planning for the Development of New Energy Vehicle Industry (2021-2035) issued by the State Council. It indicates that the annual battery capacity in China should be ramped up to 400GWh to fit the NEV demands.

To support the development of NEV business, Geely is working on constructing its own battery manufacturing facilities. In December 2020, Geely Technology Group and Farasis Energy struck a deal to jointly invest in and set up a power lithium-ion battery joint venture that engages in the R&D, manufacture and sale of cells, battery modules and battery packs. Under the agreement, both parties will leverage respective R&D and manufacturing technologies and resources related to NEVs to co-promote the construction of power battery capacity.