DNFGY Dongfeng Motor Group Company Ltd (PK)

By Dominic Chopping

STOCKHOLM--National Electric Vehicle Sweden AB Monday signed a long-term strategic deal with Chinese state-owned Dongfeng Motor Corporation (0489.HK), a move aimed at sharing costs and aiding the development of its future electric vehicles.

NEVS, the Chinese-backed company that acquired parts of the bankrupt Saab Automobile in 2012, has worked with Dongfeng on vehicle development projects for the last month. The companies have now agreed to expand their cooperation from technical development to additional business areas such as global purchasing and distribution networks.

Dongfeng will support NEVS in new vehicle production, R&D and sales and service, while NEVS will guide Dongfeng in regulation and technical specifications of its vehicles for overseas markets, as well as helping develop European and North American markets.

"Through this cooperation, NEVS will be able to create industrial synergies, share the development costs, expand the supplier bases and increase the overall competitiveness for our own future products," said NEVS President Mattias Bergman.

The Swedish brand has had a turbulent existence since it bought parts of Saab Automobile. It stopped production at the old Saab factory in Sweden last year amid a lack of funding, went through a restructure after filing for bankruptcy protection, and lost the rights to use the Saab brand name. But earlier this year the company found new Chinese investors, came out of bankruptcy, and signed a deal to build a new factory in Tianjin, China.

National Modern Energy Holdings Ltd., a Hong Kong-based holding company, owns the majority of NEVS.

Write to Dominic Chopping at dominic.chopping@wsj.com; Twitter: @WSJNordics

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(END) Dow Jones Newswires

August 17, 2015 08:05 ET (12:05 GMT)

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