China’s top economic planner has approved the launch of a joint venture between Dongfeng  and Renault SA to build and sell cars in China, the country’s second-largest automaker said on Thursday.

The 50-50 joint venture with the French automaker, to be known as Dongfeng Renault Automotive Co Ltd, will have total investment of 7.76 billion yuan ($1.3 billion), Dongfeng said in filing to the Hong Kong bourse.

Approval for the venture was given by the National Development and Reform Commission, Dongfeng said.

The new venture, which will be granted certain non-exclusive rights to use Renault trademarks and the Dongfeng brand, plans to make 150,000 vehicles a year. It will also produce and assemble engines, and will consider manufacturing key engine components.