Jianghuai working with Chinese bad boy Yang Rong to set up new energy factory

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China’s automotive bad boy, Yang Rong, who ran from China after being indicated in economic crimes is setting up a JV with Jianghuai to produce new energy vehicles and engines in Tianjin. With Yang being on the State’s bad boy list, its unclear as to how Jianghuai are hoping to get approval for the project, so it may be unlikely to roll forward past the opening statement to the Shanghai Stock Exchange.

Chinese carmaker Jianghuai Automobile Co (600418.SS: Quote) said on Tuesday it plans to invest about 30 billion yuan ($4.4 billion) on production of clean-technology vehicles through a partnership with Yang Rong, a Chinese automobile tycoon who fled the country after being accused of economic crimes.Jianghuai will set up a 50-50 venture with the private equity unit of Yang’s Far East Golden Resources Group (1188.HK: Quote) and aims to make 1 million cars in the next eight years, Jianghuai said in a statement filed with the Shanghai Stock Exchange.

The venture, based in China’s northern city of Tianjin, will also make car engines and batteries.

The government of China, the world’s biggest auto market, would invest more than 100 billion yuan to subsidize its fledgling environmentally friendly car industry over the next 10 years, according to official media. [ID:nTOE67303F]

Other carmakers, including Toyota Motor (7203.T: Quote), General Motors [GM.UL], Ford Motor (F.N: Quote) and BYD Co (1211.HK: Quote), are all racing to develop electric and hybrid cars as the U.S. and other governments set tough fuel economy and emissions standards.

Yang, chairman of Far East, and the former chairman of Brilliance China Automotive Holdings (1114.HK: Quote), BMW’s (BMWG.DE: Quote) partner in China, told Reuters in an interview last October that he was planning three multi-billion-dollar U.S. plants to make 3 million clean-technology vehicles per year by 2017 and was seeking investors for a 60 billion yuan project in China to make 6 million clean-tech engines.

Yang, who is also called Yeung Yung, was at one time China’s most influential carmaker, helping transform Brilliance from a stagnant state-owned auto factory into the country’s top maker of mini-vans. He fled China in 2002 for the United States after being accused of economic crimes.