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Carmaking giant BMW wants to take control of its joint venture in China and is set to pump billions more into its production capacity in the country.

The German firm will spend €3.6bn ($4.16bn; £3.14bn) to up its stake in Brilliance Automotive from 50% to 75%.

The Mini maker will also invest more than €3bn to expand its existing production capacity in China.

The move comes amid China’s plans to relax rules for foreign car companies operating in its enormous market.

Currently, foreign firms that want to make cars in China must have a joint venture with a local firm, but they are not permitted to own more than a 50% stake in that firm.

This rule has been in place since 1994 and has left many foreign firms frustrated. It has also restricted big global brands from gaining full access to the world’s biggest car market.

BMW said the deal with Brilliance Automotive, which is subject to regulatory and shareholder approval, would not close until 2022. That is when the 50:50 joint venture requirement for car manufacturing in China ends.

“The total yearly production capacity of the BMW Brilliance Automotive (BBA) plants [in China] will be gradually increased to more than 650,000 units in total from the early 2020s,” BMW’s chairman Harald Krüger said in a speech on Wednesday in China.

He said BBA was the cornerstone of BMW’s ongoing success in China – its largest single market – and that with the increased investment the German firm wanted to make, it would be able to produce up to 100% electric vehicles.

The Chinese government has said it wants 20% of cars sold to be electric or rechargeable-hybrid vehicles by 2025.

In February, BMW said it would build electric-powered Mini cars in China with another firm, Great Wall Motor. Cars made under than partnership are aimed at the Chinese market.

Brilliance China Automotive Holdings are the whole owners of BMW Brilliance Automotive.

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