The new plant, due for completion in 2022 in the city of Zhangjiagang, will produce BMW's electric MINIs and Great Wall Motors models, with a capacity of 160,000 cars per year, according to the groundbreaking ceremony held Friday.
BMW and Great Wall Motors are investing 650 million euros (about 715 million U.S. dollars) in their joint venture Spotlight Automotive Ltd. to build the factory.
"This joint venture will enable us to produce a larger number of MINI-brand fully electric vehicles at attractive prices for the world market," said Nicolas Peter, a member of BMW AG's Board of Management.
"This is also an important strategic step for the MINI brand," Peter said. "The joint venture with Great Wall underlines the enormous importance of the Chinese market for us."
China is the world's largest NEV market. The country saw a total of 947,000 NEV cars sold in the first 10 months of 2019, up 10.1 percent year on year, according to the China Association of Automobile Manufacturers.