Chinese automotive parts giant Zhongding Holding (Group) Co. has agreed to build a $200 million factory in the Anhui province in eastern China that will manufacture EcoMotors International's efficient, lightweight and low-cost internal combustion engine.
The partnership will allow EcoMotors, a five-year-old U.S. startup backed by Bill Gates and Khosla Ventures, to commercialize its technology and provide Zhongding with a low-cost, fuel efficient and cheap-to-make engine that it can sell domestically.
EcoMotors has developed an "opoc" engine (opposed-piston, opposed-cylinder engine is pictured above) that is 20 to 50 percent more fuel efficient, about 25 percent lower in cost to buy and half the size and weight than conventional engines. The opoc engine also generates fewer emissions, a plus in places like China where pollution problems are increasing along with car ownership.
The plant will have a capacity to make about 150,000 engines per year and generate more than $1 billion in revenue. High-volume production is expected to begin in 2014, according to EcoMotors.
Zhongding's investment marks an emerging trend of Chinese companies helping Western-based startups commercialize their products and technology or snapping up those that have fallen on tough times.
Chinese auto parts maker Wanxiang Group purchased most of the assets of bankrupt battery maker A123 Systems. The company also took a $420 million stake into GreatPoint Energy as part of a $1.25 billion deal build a coal-to-natural gas conversion plant in Western China. Chinese firms have also been keeping a close eye on investment opportunities in Israel as well as the U.S. shale industry.
Photo: Screenshot from EcoMotors video
This post was originally published on Smartplanet.com