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Apart from reforms in the coal industry, the provincial government is also planning to build a green manufacturing system, which aims to transform traditional industries into greener and more environmentally friendly modes of operation.

Another joint venture, FAW-Volkswagen, will bring to the market SUVs under both Audi and Volkswagen brands in 2018. "We are up to now underrepresented in the SUV market. You know the biggest growth rate (of the Chinese market as a whole) is in SUVs, especially the budget SUV segment where we do not have offerings at present," Heizmann said.

Another two updated Proton models were launched earlier this month, helping to further boost the confidence of the carmaker and its 175 dealerships.

Any cost increases could ultimately be passed along to the consumer.

Another prerequisite for an electric carmaker to build new facilities is that all existing plants for electric cars in the same province must have used at least 80 percent of their designed capacity.