Finnish battery maker European Batteries Oy will build a production center in north China's city of Tianjin, local officials confirmed recently.

The city is among the 25 pilot cities for the country's massive energy-saving and new energy vehicle demonstration program.

Located in Tianjin's Binhai New Area, the facility will manufacture Li-ion batteries for hybrid and electric vehicles, according to an agreement signed by the company and Tianjin local government.

The center will be built with an investment of CNY 2 billion (US$ 318 million) and have an annual output value of CNY 4 billion after full operation.

The first phase of the project will come into operation in October, according to the agreement.

The company's board chairman Eero Nuutinen said at a signing ceremony that he is confident about the investment, adding that his company will introduce new technology and products in order to further explore the Chinese market.

European Batteries Oy develops and manufactures large, rechargeable Li-ion based prismatic cells and battery systems, utilizing the industry's leading technology and know-how.

Tianjin is already home to the Lishen Battery Joint-stock Company, one of the top three Li-ion battery firms in China.