(Yicai) Nov. 11 -- Wanfeng Auto Wheel’s shares jumped after the Chinese firm said it would buy the intellectual property rights to electric vertical take-off and landing aircraft from Volkswagen Group instead of setting up an eVTOL joint venture with the German carmaker as planned.

Wanfeng Auto [SHE: 002085] closed 5.3 percent higher at CNY23.50 (USD3.30) a share in Shenzhen, after surging by as much as 6.7 percent earlier today.

Wanfeng Auto’s unit Wanfeng Aviation has signed a non-binding agreement to buy eVTOL IP and assets from Volkswagen’s German subsidiary, covering industrial design, interior and exterior parts, human-machine interaction, and integrated software-hardware developments, the Zhejiang province-based firm announced recently. 

Wanfeng Auto added that it gave up on an earlier plan to set up an eVTOL JV with the Chinese arm of the German owner of the Porsche, Audi, and Skoda brands. The new deal is exclusive, since the transfer of IP or assets to non-related parties is not allowed over the next 12 months.

With Volkswagen's support, Wanfeng Auto intends to advance the commercial mass production of eVTOLs, developing vertical mobility solutions and striving to make the eVTOL business a new business growth point, the company said.

When Wanfeng Auto announced in February that it planned to form a JV with a world-famous auto firm's Chinese unit to produce eVTOLs, it did not name the proposed partner.

Wanfeng Auto mainly produces auto parts, but since Wanfeng Aviation acquired Austria’s Diamond Aircraft Group in 2018, that side of its business has become more important. At CNY2.8 billion (USD389.6 million), it generated almost a fifth of the parent company's total revenue last year. Diamond Aircraft sells planes globally to flight schools, airlines, aviation clubs, and individuals.

Editor: Emmi Laine