(Yicai Global) July 28 -- China Automotive Engineering Research Institute, a state-backed enabler of automobile innovations, intends to spend CNY2.4 billion (USD355.9 million) to set up facilities to accelerate the development of electric, hydrogen, and connected vehicles.

CAERI will construct two centers with five labs in eastern China, a hub of automotive manufacturing, the Chongqing-based institution said in a statement yesterday. The labs will test and develop new materials, parts, and finished vehicles as the application of intelligent connected vehicles is quickly growing.

Most of the funds, or CNY2.3 billion, will be poured into Jiangsu province's Suzhou. That involves building a regional headquarters, four testing and R&D labs, as well as supporting facilities. The comprehensive testing base for electric cars and ICVs is set to be ready in 2025.

The remaining CNY330 million (USD48.9 million) will be spent on building a lab to test and develop hydrogen vehicles and parts in nearby Changshu. The base should be put into use next year.

The investment plans will comprehensively enhance CAERI's technical abilities to serve smart, connected, electric and low-carbon vehicle manufacturers, it said. The bases will become one-stop testing providers for auto companies in eastern China, it added. 

The scope can even be widened. In Suzhou, CAERI will actively pursue establishing a national supervision and inspection center in the field of automobile communication and software, it envisioned.

The plans received a cautious response from investors. CAERI's stock price [SHA: 601965] slid 0.2 percent to close at CNY15.97 (USD2.40) after climbing as much as 4.7 percent intraday. The stock has climbed about 60 percent since late April when major market indexes bottomed out.

Editor: Emmi Laine, Xiao Yi