Early last month, China's Changan Auto reportedly pulled the plug on its hybrid Jiexun. The cancellation was claimed to have stemmed from the hybrid's abysmal sales. Therefore, it came as somewhat of a surprise to discover that on Tuesday, Changan and LG Chem, a South Korean chemicals company, signed a strategic supply partnership for lithium-ion batteries for the automaker's alternative energy vehicles.
Terms of the deal state that LG Chem will produce li-ion batteries for Changan's future electric and hybrid vehicles. In addition, both companies are discussing the establishment of a full-blown joint venture and are considering the construction of a plant in Chongqing, a city in southern China. Specific details of the partnership are murky, but it seems as though either LG Chem will establish its own production facility in Chongqing, which would simply make it a supplier of batteries for Changan, or that the two sides will team up on construction of the plant, thus giving Changan an entry point into the li-ion battery industry.

[Source: Gasgoo]


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