(Yicai Global) Oct. 19 -- Chinese composites firm Haiyuan New Material Technology will construct a carbon fiber production base in eastern Zhejiang province to develop ultra-light materials for new energy vehicles.

Haiyuan inked a framework agreement with Zhejiang Sea Port, an investment firm set up by Zhejiang province's government, regarding the new plant, Fujianese chemical firm's parent Haiyuan Composites Technology said in a statement yesterday. The company did not disclose the size of funding nor the planned output but said that Haiyuan has designed a production line for ultra-light car bodies while securing intellectual property rights. 

The investment firm will also establish a car industry fund for new material development, to which Haiyuan will invest in. The fund will have an initial investment of CNY2 billion (USD290 million) and later it will acquire a stake in the vehicle parts firm.

Both parties will promote the use of carbon fiber materials in cars to expand from Zhejiang to the whole country, while helping Haiyuan to become the leader in the sector, the statement added.

Editor: Emmi Laine