Baosteel Group's investment arm has teamed up with ALD Automotive to set up a vehicle-leasing firm in Shanghai, the two companies said Tuesday.

The joint venture, ALD Fortune Auto Leasing (Shanghai) Co, has a registered capital of 50 million yuan (US$7.32 million).

Baosteel's investment arm, Fortune Investment Co, and overseas investor ALD, each takes a 50-percent stake in the new joint venture, which opens for business today.

The two firms received the business license for the joint venture in late August.

"It marks a vigorous step for the two parties to explore the huge market potential and to accelerate the development of the auto-leasing and fleet-management businesses in China," they said.

The vehicle-leasing business is regarded as a "sunrise" industry in China.

ALD Automotive will make use of clients' resources from Baosteel and its related enterprises for the joint venture.

The joint venture is targeting multinational companies investing in China and big state-owned Chinese companies.

In the next five years, the joint venture aims to establish a fleet of 10,000 cars in China, based on demand from the Yangtze River Delta, the Pearl River Delta, Beijing and Bohai Sea areas and Chengdu in the southwest Sichuan Province and Wuhan in the central Hubei Province.

"We are very happy to team up with Baosteel, such a powerful group in China," said Gianluca Soma, chief executive officer of ALD.

"We will use all efforts, expertise and our international client base to jointly drive the newly created company to the utmost success."

ALD, under Societe Generale, is one of the world's top three in the auto-leasing industry in terms of market share and fleet size.

ALD has built up a fleet of 800,000 cars in 39 countries.

About 80 percent of ALD's key global clients have invested in China, leading the company to follow the same path.