MUMBAI (Bloomberg) -- Lotus plans to build cars and engines in China in a joint venture with China's Goldstar Heavy Industrial Co.
The proposed venture will initially study production and sales of vehicles and parts, DRB-Hicom, Lotus’ Malaysian parent company, said in a stock exchange filing in Kuala Lumpur.
Goldstar is a car manufacturer based in Fujian.
The venture will involve an investment of 10 billion yuan ($1.6 billion) over 15 years, and will make and sell vehicles and engines within 24 months of obtaining a license, the filing said.
DRB-Hicom has been trying to restructure Lotus after inheriting the company through its purchase of carmaker Proton in 2012.
Manufacturing in China allows companies to avoid the nation's 25 percent import tariff.
DRB-Hicom will raise the funds required for the venture through internal accruals and borrowings, according to the filing.