China has approved a joint venture between Japan's Hino Motors and Guangzhou Automobile Group for setting up the country's one of the largest production bases for commercial vehicles.
The joint venture, which will be launched in October, will target medium- and high-end business automobile market, media reports said.
The National Development and Reform Commission, the country's top planning body, has approved the establishment of the joint venture in August, with a cooperating term of 30 years, Shanghai Securities News reported.
According to the joint venture plan, gross investment in the project will exceed 3.1 billion yuan (USD408 million), with a registered capital of 1.5 billion yuan.
The joint venture will build a new factory in Aotou Township of Conghua city. The factory will also include a research and development centre.
Hino Motors is a member of the Toyota Group, which holds a controlling stake in the company. The new project is the second major cooperation between Guangzhou Automobile and Toyota since the two companies started to build an engine joint venture in 2004.
Several popular models of Hino Motors will be introduced. The annual output capacity of the new project will be 20,000 heavy trucks, 25,000 engines and 30,000 light trucks.
An official with the Guangzhou government said that auto industry has become the south China city's pillar industry, ranking the second in terms of revenue. Between 2000 and 2006, the output value of Guangzhou's motor industry has risen from 12.43 billion Yuan to 116.82 billion Yuan.