A worker looks on at a BYD assembly line in Shenzhen, China. Photo: Reuters/Bobby Yip

BYD, China’s leading new energy vehicle manufacturer, plans to set up a private equity fund of 6.25 billion yuan (US$940 million) to promote its light train system, Shanghai Securities Journal reported.

The company said its wholly-owned subsidiary Shenzhen BYD Investment Management Co. Ltd. will issue the fund. Western Trust Co. Ltd. will subscribe 5 billion yuan of the A-class fund shares, while BYD Auto Industry Co. Ltd. will subscribe 1.25 billion yuan of the B-class fund shares.

The train system, called “Yungui,” which means SkyRail, is the company’s self-developed low-cost overground metro system tailor-made for medium and small cities.

So far, more than ten cities including Xian, Shantou, Shenzhen and Guangan have signed up for the light train. It is expected that more than 20 cities will sign up.

Previously, Wang Chuanfu, the chairman of the company, said the market for light trains in China could reach as much as 10 trillion yuan.