Its been revealed that Daimler and Geely will team up to build the next generation of Smart electric cars in China.
The joint venture is being seen as a way to boost the economy in what has developed into a struggling market.
Geely, who own a 10 percent stake in Daimler want to develop electric and self-driving cars in an effort to compete against tech-giants such as Uber and Google.
According to Reuters Daimler have said that the next generation of Smart city cars will be built a factory in China.
It is believed that they plan to share its expertise in the motoring industry with Geely, best known for producing the latest incarnation of the London taxi.
Due to the prohibitive cost of the manufacture of electric car batteries, difficulties have ensued in relation to building zero-emissions vehicles at an affordable price. This has lead to several manufacturers striking up alliances with companies in the Chinese market.
Recently BMW announced plans to build electric Minis in China, primarily because of low production costs.
The financial details of the partnership have not been revealed, but it is expected that the tie-up will be completed in late 2019.
Geely have rapidly expanded since 2010, when it acquired Swedish carmaker Volvo from Ford, whilst last year both Geely and Daimler developed a ride-hailing project in China.
Image: Smart UK