Geely has signed a deal to set up an automatic transmission joint venture with Japan's Aisin Group.
The China Daily reported the joint venture has a registered capital of $117 million. Aisin AW, the world's largest maker of automatic transmissions, holds a 60-percent stake and Geely Luoyou Engine Co. holds the remaining 40 percent.
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The plant, with a designed annual production capacity of 400,000 6-speed automatic transmissions, is scheduled to start mass production in 2020, Geely said.
The carmaker said its current transmission production capacity cannot meet its growth demand, and the joint venture could offer more high-performance transmissions.
An Conghui, president of Geely, said the joint venture will help Geely improve its research and development and manufacturing capacity in the advanced powertrain field.
Aisin said it will restructure production lines at Tangshan Aisin Gear Co., Ltd., a manual transmission production factory in China, and begin manufacturing automatic transmissions there starting August 2019, in an initiative to build an automatic transmission production capacity of 12.5 million units in 2020.
Tangshan Gear began production in 1996, and manufactures drive plates, which are manual and automatic transmission parts. Now, the existing manual transmission production line will be restructured, and a new automatic transmission assembly line will be established to supply 6-speed automatic transmissions for front-wheel drive vehicles to automobile manufacturers in China at a scale of 400,000 units per year.
