German automaker Volkswagen AG signed joint declarations with its Chinese partners on Friday.

Volkswagen will partner SAIC Motor Corp and First Automotive Works (FAW) Group to develop and begin production of new-energy vehicles in its largest market from 2016. Chinese President Xi Jinping and German Chancellor Angela Merkel were at the signing ceremony.

"Volkswagen has already been a reliable partner for the People's Republic of China for 30 years," said Jochem Heizmann, Volkswagen board member and CEO Volkswagen Group China. "We will continue to set the standard in the Chinese automotive industry with highly-efficient engines and forward-looking technologies."