Watertown, Mass.-based A123Systems said it’s entered into a joint venture with Chinese automaker SAIC Motor.

The companies plan to develop, manufacture, and sell complete vehicle traction battery systems. The systems would be used in hybrid electric and all electric vehicles, heavy duty trucks, and buses in China.

A123, which went public on the Nasdaq Stock Exchange in September, develops and manufactures advanced Nanophosphate lithium ion batteries and systems. A123 said it is looking to strategically gain market share in the Chinese transportation segment through the venture.

Shanghai-based SAIC is the largest automotive manufacturer listed on the Chinese A-share stock market, selling more than 2.4 million vehicles as of November.

SAIC is to hold 51 percent of the joint venture, with A123 taking 49 percent, and management responsibilities being shared equally. Financial details were not disclosed.

The joint venture—being called Shanghai Advanced Traction Battery Systems (ATBS)—is expected to be the preferred supplier of complete energy storage systems for all hybrid electric and electric vehicles manufactured by SAIC and its subsidiaries. SAIC plans to introduce its EVs to the market in 2012.

Under the agreement, A123 intends to supply advanced automotive battery cells and work with SAIC to develop integrated battery systems for ATBS.

ATBS has also been awarded a contract to supply battery systems for SAIC’s plug-in hybrid vehicle program.

SAIC previously announced plans for a hybrid Roewe 750 sedan and a plug-in hybrid version of the Roewe 550, which it claims could lower fuel consumption by 20 percent and 50 percent respectively. The Roewe 550 and 750 are expected to use A123 battery cells

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