On Monday, Silk EV, a little-known U.S.-based engineering and design firm disclosed it plans on investing $1.41 billion (10 billion yuan) in order to make sports cars with China’s FAW Group under the Hongqi brand, the brand of choice for China’s late revolutionary leader Chairman Mao Zedong.
Silk EV has signed a memorandum of understanding with FAW to this effect, said the U.S. company.
Silk EV will launch a joint venture with China’s state-owned FAW automaker and the cars will be produced in Changchun, northern China. Silk EV has dubbed the cars as S-series.
According to Silk EV’s website, the company is a full auto solutions provider which focuses on Chinese auto market.
In April 2019, Silk EV launched a company in Shanghai’s free trade zone with registered capital of$141,281 (1 million yuan), according to a filing on the official National Enterprise Credit Information Publicity System.
Hongqi, meaning Red Flag, was launched by FAW in 1958. It is widely regarded as a symbol of China’s ruling Communist Party, with former leader Mao often seen riding in high-end black saloons.
FAW is aiming to produce 200,000 Hongqi branded vehicles this year and touch 1 million sales by the end of this decade. Its plans for the brand include having a bouquet of 21 models by 2025.