SHENZHEN - China's BYD Auto Industry Co Ltd on Wednesday signed an agreement with Japanese carmaker Hino Motors Ltd on the establishment of a joint venture for commercial battery electric vehicles (BEVs) development.

According to the agreement, the new company is scheduled to be established in China in 2021, with BYD and Hino each making a 50 percent capital investment.

It will combine the strengths of both companies to develop BEVs and electric units for customers, primarily in the Asian market, according to a source with BYD.

The joint venture plans to launch vehicles under the Hino brand by 2025, said the source.