Daimler AG said its joint venture with China's BYD Co has won government approval.

The Shenzhen BYD Daimler New Technology Co, which is a 50-50 venture between the two car makers, secured the business license on Tuesday after signing the contracts in May, Daimler said in a statement.

The company will develop an electric car tailor-made for the Chinese market. It will also be marketed under a new brand co-owned by Daimler and BYD.

At the research and technology center in Shenzhen, the German and Chinese engineers, designers and other experts are working well and will soon be joined by more colleagues from both partners' firms.