A groundbreaking ceremony for the Detroit new energy vehicle production project takes place in Xiaohe Industrial Park, Jinzhong city, Dec 12. [Photo/sxgov.cn]

Detroit new energy vehicle production project, a Sino-foreign joint venture, started construction at Xiaohe Industrial Park in Jinzhong city, Shanxi province, on Dec 12.

Financed and constructed by Shanxi Energy&Traffic Investment Co and Detroit Electric in the United Kingdom, the 21-billion-yuan ($3.04 billion) project will cover an area of 2.33 square kilometers.

Covering 0.8 square kilometers, the first phase of the project, which has received an investment of 6 billion yuan, will include a research and development center as well as workshops for processing vehicle parts, cell packaging and testing.

It will take two years to complete the first phase of construction. The annual output of the first phase is expected to reach 100,000 electric vehicle parts and annual sales are expected to be 32.4 billion yuan, with annual profits of 1.5 billion yuan.

Detroit Electric is a long-established electric vehicle manufacturer with more than 60 patented technologies covering the core systems of electric vehicles and the internet of vehicles.

Taking advantage of Detroit Electric's expertise in the production of finished vehicles, the project will manufacture products which are first sold in the European and American markets, before gradually realizing the domestic production of finished vehicles.

The new energy vehicle industry is a key emerging industry in Shanxi province’s development plan. The joint new energy vehicle project we’ve committed to will help transform the province's industrial structure and contribute to local economic growth, said Wu Qiang, chairman of Shanxi Energy&Traffic Investment Co.

Once it is completed in 2022, the project will develop into a comprehensive vehicle industrial park combining vehicle manufacturing, R&D, auto part production and logistics in Jinzhong, generating an expected annual output value of 100 billion yuan and bringing nearly one trillion yuan of revenues to upstream and downstream industries.