Chongqing Zongshen Power Machinery Co. announced today that it has signed a memo of cooperation with Mission Motors, which could see the Chinese company link up with the San Francisco firm to develop electric drive systems for the emerging market and in other markets throughout the world.
In the memo, Zongshen outlines its intent to become a major shareholder in Mission Motors, and to also inject capital into the small startup after it presents a three year plan to the Chinese company. For Mission Motors the move would be valuable strategic partnership to gain a foothold in China, which already has a booming two-wheeled market and need for reduced CO2 emissions.
“Mission Motors has identified Zongshen Power as a potential partner in the Chinese electric motorcycle market,” says Mission Motors’ Jit Bhattacharya. “China is an enormous market for electric two-wheelers with a number of Chinese cities having banned gasoline-powered motorcycles and scooters. We are exploring how we can leverage Mission Motors’ technology with Zongshen’s strengths in high volume, low-cost manufacturing to create a lower cost electric powertrain for the Chinese market. As part of this ongoing discussion, Zongshen Power is also considering a strategic investment in Mission Motors, but nothing has been finalized.”
It is our understanding that this is a custom in Chinese business culture where companies sign a document which explains that they are considering a business transaction. While nothing is final yet, and we should be point out that other reports appear to over-state the current situation, suggesting that Zongshen has already acquired a majority interest in Mission Motors, while in fact Zongshen merely hopes to complete an investment in the San Franciscan company by the end of June this year.
Chongqing Zongshen is one of China’s largest motorcycle engine manufacturers, and marks yet another series of moves by American electric motorcycle companies looking not only for funding, but also looking abroad for business opportunities. Just last month we reported that Zero Motorcycles closed a $5.5 million round of investment, and Brammo also recently announced a partnership with Jackie Chan’s JCAM to distribute bikes in Asia.