lithium-ion pouch battery maker Farasis Energy and car manufacturer Geely plan to create a new battery company with a billion yuan (US$650 million), said Farasis on Monday.

The two companies announced a collaboration in December last year. Farasis will be in charge of the R&D and sales with Geely providing the money.

The agreement came to Farasis’s aid right on time. Only listed on the Shanghai STAR Market in July last year, Farasis’ clients, including Beijing Auto, GWM, and FAW, have slashed their orders and, as a result, Farasis reported a 330-million-yuan loss last year. A batch of batteries it sold to Beijing Auto last year was faulty and the company had to recall over 30,000 EVs.

With the new venture, Farasis has locked on at least 80 percent of Geely’s battery demand. The two already have plans for another entity to produce 12-gigawatt hour of batteries.