Ford said it would launch a plug-in hybrid car in China in 2018 and a fully electric sport-utility vehicle in the next five years, as it works toward electrifying most of its lineup in the world's biggest auto market by 2025.

This comes at a time when Beijing is urging car manufacturers to sell more electric vehicles, laying out strict fuel economy targets and subsidising certain new energy vehicle models, in a bid to cut air pollution and promote technological innovation.

“The time is right for Ford to expand our EV (electric vehicle) lineup and investments in China,” Ford chief executive Mark Fields said in a statement on Thursday.

The US automaker, which makes cars in China through a joint venture with Chongqing Changan Automobile Co, said it plans for 70 per cent of Ford brand vehicles sold in China to be conventional hybrids, plug-in hybrids or full battery electric by 2025.

Ford said it would launch its first hybrid that is locally made with Changan, the Mondeo Energi sedan, early next year.