BMW is looking to expand its presence in China to build EVs, potentially with Great Wall Motors.

BMW is the latest automaker looking to make inroads quickly into the electric vehicle market in China through a deal with a local partner: Great Wall Motors.

Actually the deal will be BMW’s second partnership in the country as it’s already working with Brilliance China Holdings in Shenyang. The new venture will be based in Changshu, according to Reuters. The plant will produce electric vehicles exclusively.

“We are in discussions with Great Wall about setting up a joint venture to produce cars in Changshu,” said a BMW executive told Reuters.

(BMW Extended Warranty Guide)

The move to get a bigger foothold in China is predicated on the government’s push to grow EV sales to a quarter of all new vehicles by 2025. The government also recently mentioned its considering following in the footsteps of countries like Great Britain, France and others and eliminating internal combustion engine vehicles altogether by 2040.

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To hasten the conversion to EVs, the Chinese government is loosening the restrictions on foreign automakers, but only for electric vehicle producers. Tesla, Ford Motor Co, Daimler AG, and General Motors are among those that have already announced plans for making electric vehicles in China.

Operations with Brilliance, which produces BMW 1, 2, 3 and 5 Series as well as the X1, will not be affected by the new partnership. BMW is the second-largest luxury maker in the country behind Audi and ahead perennial rival, Mercedes-Benz. BMW’s sales in China grew 11.3% last year.

(Click Here for details about this BMW partnership with FCA, Intel and Mobileye.)

Great Wall’s interest in a partnership is noteworthy since it has been rumored to be a potential partner with Fiat Chrysler Automobiles. FCA, led by Sergio Marchionne, has been on the hunt for mate or even a potential sale of assets for the past 18 months.

Already rebuffed by General Motors, Volkswagen and others, the automaker’s recent dalliance with Great Wall had observers abuzz with the possibilities, including the growing EV market in China. However, Great Wall officials have tempered speculation about any deal, suggesting talks were not substantive and no deal is forthcoming.

(Will China ban the internal combustion engine? Click Here to find out.)

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