Beijing (PingWest)-SAIC Motor, China’s largest state-owned carmaker, has reached a partnership agreement with Chinese e-commerce giant Alibaba and Shanghai Pudong New Area Government, to form a new electric vehicle manufacturing company called Zhiji Motor.

Zhiji Motor is a joint venture co-owned by SAIC Motor with 54% stakes, Alibaba with 18% and Shanghai Pudong New Area Government with 18%, and others.

Zhi Motor has far raised over CNY10 billion in its initial round of financing.

Zhiji Motor's first car is expected to be released in January, 2021 in Shanghai, London and North America.

The cooperation come at the time when the shares of Chinese EV startups such as Nio and Xpeng soared in recent months.

In addition, SAIC said it would partner with Alibaba to invest CNY5.4 billion to form a private equity fund that dedicated to the investments of electric vehicle technologies.

SAIC’s ties with Alibaba can be traced back to 2015 when they jointly invest a CNY160 million into solutions of internet-connected cars. Under the partnership, some of SAIC’s Roewe sports-utility vehicles run on Alibaba’s smart technology YunOS, an intelligent digital map that features voice control and internet ID.

Apart from Alibaba, the another tech giant making major moves in Auto recently is Huawei. Most recently, Huawei announced it would integrate its smart car into its consumer business group, whose primary focus on one of Huawei’s core business handsets.

Huawei’s goal in auto is not to manufacture car but to focus on developing information and communications technology to assist automakers in producing cars, the world’s largest telecommunications equipment maker and China’s biggest smartphone vendor said in a statement.

Competition in China’s electric market is intensifying as the country aims to strengthen its car manufacturing industry, which is one of initiative that align with “Made in China 2025” strategy.  

The country's sales of new-energy vehicles surged 105 percent year on year to 160,000 units in October.

Earlier this month, China’s State Council announced a nationwide goals that the share of New Energy Vehicles, which includes electric, plug in hybrid and hydrogen fuel-cell vehicles, will account for 20% of total new car sales in China by 2025 and account for the majority of sales by 2035.