BYD Company Ltd. (BYD) and Toyota Motor announced today that they have signed an agreement for the joint development of battery electric vehicles (BEVs).

The two parties will jointly develop sedans and low-floor SUVs as well as the onboard batteries for these vehicles and others with the aim to launch them in the Chinese market under the Toyota brand in the first half of the 2020s.

BYD was founded in 1995 as a battery business and has grown into a total energy solution company, manufacturing not only electrified vehicles but other products such as large-size energy storage cells. In 2008, BYD became the first company in the world to sell mass production of plug-in hybrid electrified vehicles (PHEVs).

To curb global warming, both BYD and Toyota seek to reduce CO2 emissions by promoting the widespread use of BEVs. To accomplish these goals, both companies believe there is a need to put aside their rivalry and collaborate; therefore, the two companies have agreed to jointly develop BEVs.

Going forward, BYD and Toyota will make use of the electrified vehicles, and battery development technologies they have acquired through their market introductions and will work together to further develop BEVs.

Earlier this week, Toyota announced it was teaming up with China’s Contemporary Amerex Technology Co Ltd (CATL) to supply and develop batteries for lower-emission vehicles.