(Yicai) Nov. 23 -- Fulin Precision's shares rose after the Chinese auto parts manufacturer said it will invest CNY1 billion (USD140 million) to build a factory to make core components for electric vehicles to serve customers in Changzhou.

Fulin Precision [SHE: 300432] closed 4.5 percent higher at CNY12.54 (USD1.77) a share today, after surging by as much as 6.7 percent late morning. Shenzhen stocks rose 0.8 percent overall.

Fulin Precision plans to use the new plant to research, develop, and produce core EV parts, including shaft mount gear reducers and electric drive systems for new energy vehicles, the Mianyang-based firm said yesterday. Located in Changzhou, eastern Jiangsu province, the factory will likely be ready by the end of next year, it added.

The industrial park where the plant will go up has also reserved land for a future capacity expansion until the end of 2025, Fulin Precision noted, without disclosing the factory's annual capacity and expansion plans.

The new plant can improve the production capacity of Fulin Precision's products, meet orders from leading local NEV brands, improve the firm's service capacity in eastern coastal areas of China, and effectively reduce operating costs, according to the company.

Fulin Precision's NEV customers include BYD, Li Auto, Nio, and Xpeng Motors, according to its 2022 annual earnings report. The firm did not disclose the names of any new clients in Changzhou, but BYD and Li Auto are the most well-known carmakers with factories in the city.

Changzhou is an emerging powerhouse for the production of NEVs, with its annual output of up to 340,000 units last year increasing to over 1 million as of Oct. 18, official figures showed.

Founded in 1997, Fulin Precision mainly produces auto engines and transmission parts, and it has shifted to the NEV field in recent years, covering motor control systems, lithium battery materials, and electronics.

Editor: Martin Kadiev