BMW Group and Great Wall Motors on Friday announced the establishment of a 50:50 joint venture in China that will be responsible for building electric cars for the Mini brand. The announcement follows the signing of an initial agreement last year.

The joint venture, which goes by the name Spotlight Automotive Limited, expects to have a new plant in Zhangjiagang, in China’s Jiangsu Province, completed by 2022. The plant will be responsible for electric Minis as well as models for Great Wall, with initial capacity to be 160,000 vehicles annually.

“With the BMW Group as a pioneer in the field of electromobility and Great Wall as a major player and expert in industrialisation in the Chinese market, we are joining forces for development and production of the future electric Mini and new Great Wall models,” said Klaus Froehlich, BMW's R&D chief.

BMW and Great Wall will each invest 650 million euros (approximately $715 million) in Spotlight, which has also been tasked with joint development of vehicles. One of these could be the oft-rumored minicar that was first hinted at in 2011 with the Mini Rocketman Concept.

BMW isn't abandoning Mini's current plant in Oxford, United Kingdom. The Oxford plant will continue to churn out Minis for worldwide sale, including the electric Cooper SE which arrives at dealers next March. Mini also produces some models at a plant in The Netherlands shared with BMW.

But building electric minicars in western markets at a profit is proving to be a challenge for most automakers, something backed by comments made by BMW's head of finances, Nicolas Peter, during the Friday announcement.

“This joint venture will enable us to produce a larger number of Mini-brand fully electric vehicles at attractive conditions for the world market,” he said.

It's part of the reason Daimler in March partnered up with Geely to jointly develop and build electric Smart cars in China.