On August 22nd, Ford (NYSE:$F) announced plans to partner up with China-based auto company Anhui Zotye Automobile Co (SHE:$000980) to produce electric vehicles in China under a newly-formed brand. With the rise of electric vehicles and China’s aggressive attempts to keep its emission levels under control, Ford’s potential partnership with Anhui could be incredibly beneficial for both parties. China has recently invested billions of dollars to fund research and subsidies – including electric vehicles and other similar auto alternatives like plug-in hybrids – for more environmentally-friendly production methods and ways of living. The country hopes that by 2025 a fifth of the vehicles sold will be either electric vehicles or plug-in hybrids.

China’s push for more eco-friendly options have gotten electric vehicles and clean energy giants like Tesla (NASDAQ:$TSLA), Daimler AG (ETR:$DAI), and General Motors (NYSE:$GM) to disclose their plans of producing and selling their electric vehicles in China. Ford’s partnership with Anhui will no doubt help in the competitiveness of the automobile industry and in increasing its sales in China. So far this year, overall sales in China had declined by 7%. Anhui Zotye, on the other hand, is known as one of the leaders of China’s electric vehicles businesses, selling more than 16,000 electric vehicles so far in 2017 – a 56% year-over-year rise.

Ford believes that China will have one of the fastest and largest new energy vehicles (NEV) in the world – by 2025, the company estimates that this particular business will grow and produce six million vehicles annually in China, four million of which will most likely be electric vehicles. As such, investors and shareholders shouldn’t be too surprised at Ford’s announcement of a partnership with Anhui. In fact, Ford’s potential work with Anhui signals a more solid commitment of Ford’s hopes to distribute electric vehicles and other NEVs in China.

On Tuesday, August 22nd, Ford signed a memorandum with Anhui in which the company stated that it understands it will be working with Anhui to build a new brand of electric vehicles that will eventually be produced and sold. The memorandum also stated that the joint venture will be split 50-50 between the two companies. Financial details and when the partnership will be finalized were not specified in the memorandum.

The possibility of Ford’s joint venture with Anhui isn’t the automaker’s only attempt at breaking into the electric vehicles business in China. Back in April of this year, Ford had released outlines of its plans to distribute hybrid and/or electric vehicles produced in China through Chongqing Changan Automobile Co Ltd., the company’s Chinese joint venture partner. However, Ford had expressed concerns and caution at the time due to both the unpredictability of consumer interest and how strict government policies would be.

Once the partnership has finalized and the companies have made sure that they’ve gotten the needed regulations approved, Ford will release further details on the joint venture brand, the products, and production goals. While the prospect is exciting, it is still important to note that a lot of things are still up in the air regarding this partnership between Ford and Anhui.

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