(Yicai Global) Feb. 8 -- South Korean auto manufacturer Kia and its Chinese partner Jiangsu Yueda Group plan to invest USD900 million to overhaul and expand capacity at their loss-making joint venture after a founding partner pulled out at the end of last year.

The capital injection will hike output at Dongfeng Yueda Kia Motor, which will be renamed in April, to over four million vehicles in the next ten years, Yancheng, eastern Jiangsu province-based Yueda said. At present the JV, in which both Kia and Yueda hold a 50 percent stake, runs three factories with an output of 900,000 autos a year.

Seoul-based Kia plans to introduce six new electric vehicle models into China by 2027 through the JV, such as the Kia EV6 crossover, Yueda said. The JV will also put more focus on global exports to alleviate the firm’s overcapacity problems.

The overhaul is happening after Dongfeng Motor Corp. sold its 25 percent stake to Yueda last November for CNY297 million (USD46.5 million) after years of heavy losses.

Dongfeng Yueda Kia lost more than CNY2.6 billion (USD407 million) in the first 10 months last year, and in 2020 it hemorrhaged CNY4.75 billion (USD744 million). Sales have been on the slide since 2017. In 2021, the JV shifted just 152,000 autos, a quarter of the number sold during the peak year of 2016.

Editors: Zhang Yushuo, Kim Taylor