GAC-Nio, a joint venture between traditional carmaker GAC and startup Nio established in April last year, is showing signs of progress, unveiling its first brand and concept car in Hangzhou, Zhejiang province last Monday.

The new brand, Hycan, is aimed at the midmarket and will be priced slightly higher than models from GAC New Energy but lower than that of Nio models.

The company believes that its light-asset strategy which focuses on R&D, design, sales and after sales, and integrating manufacturing resources will alleviate the typical financial pressures in the new energy vehicles industry.

The JV has taken its cues from the guideline released by the Ministry of Information Technology in December encouraging more cooperation among carmakers in terms of development and production, in order to facilitate faster and more efficient production of NEVs.

Registered with an initial capital of 500 million yuan ($72.36 million), GAC-Nio is owned by GAC Group, GAC New Energy Automobile, Nio and Nio Capital with 22.5 percent each, with the remaining 10 percent owned by employees of GAC-Nio.

"Hycan-branded vehicles will benefit from the global resources of GAC and Nio, including technical teams from Beijing, Shanghai and Silicon Valley in the United States where the GAC R&D Center and internet of vehicles R&D team of Nio are based," said Liao Bing, CEO of GAC-Nio.

The Hycan concept, a pure electric SUV, will be put into production at the GAC's NEV industrial park located in Guangzhou, according to the company.

Construction on the 45-billion-yuan park completed in January and is expected to produce a total of 400,000 vehicles annually.

Liao said the pure electric SUV will hit the market by the end of this year and is expected to be delivered to customers by the middle of next year.

In addition to support from GAC and Nio, the joint venture will also cooperate with companies, such as lithium-ion battery provider CATL, telecom giant Huawei and Bosch on key technologies such as powertrain and internet of vehicles.

According to official statistics, GAC New Energy Automobile sold 6,157 units in the first four months of this year, marking a year-on-year increase of 82 percent.

The company has four models on the market, the GA3S PHEV, Aion S, GE3 530 and GS4 PHEV.

The Aion S sedan, launched in late April, has received 30,000 orders and the pure electric SUV Aion LX, which has a range of 600 kilometers on a single charge, will be put into production in September. Nio has its ES8 and ES6 models currently on the market.

In the first quarter, the startup delivered 4,010 units of its ES8, the top selling model among NEV startups.