Honda And GAC Group will establish facilities in China for the production of new energy vehicles.

Honda Motor's joint venture with the Chinese GAC Group will invest 3.27 billion yuan ($ 469 million) in the field of new energy production in China. This initiative emerged as part of an effort by Honda and GAC to meet the environmental car production quotas it has brought in China's automotive sector. According to the regulation introduced by China, by 2019, 10% of the total vehicle production of an automobile manufacturer must be composed of green vehicles.

The Honda-GAC joint venture will establish a plant with a capacity to produce 170,000 new energy vehicles per year. New energy vehicles include electric cars as well as rechargeable hybrid vehicles.

A source close to the joint venture stated that the GAC Trumpchi GS4, an electric compact SUV under the scheme, will be produced and sold by Honda with the GAC. The same source, Honda's car, Honda will be sold under the Trumpchi brand, he added.

This joint venture agreement is similar to an earlier agreement between Toyota Motor and its local partner. Under the deal it was announced that Toyota sales centers would sell electric vehicles without the distinctive triple oval logo of the Japanese company.

This new joint venture with Honda will include the Chinese partner GAC brand in vehicles.

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