FRANKFURT -- Daimler and Geely on Friday said China could emerge as a manufacturing and export hub for hybrid powertrains jointly developed for Volvo and Mercedes-Benz cars.
Earlier, Daimler had said it will cooperate with China's Geely to build next-generation combustion engines for use in hybrid vehicles.
The engines will be produced in China as well as in Europe, and Geely and Daimler will cooperate in engineering, sourcing and production, Daimler said in a statement.
"The export of the engine from China is considered to be an option," the statement said.
Geely owns a 9.69 percent stake in Daimler.
Mercedes-Benz aims for more than half of its passenger car sales to be comprised of plug-in hybrids or full-electric vehicles by 2030.
An Conghui, CEO of Geely Auto Group said: "This project reflects the need for economies of scale and targeted research and development investment in clean and highly efficient powertrains and hybrid drive systems and their applications."