Audi  (AUDVF) became the latest auto maker to stack more chips on China Monday when it announced that it is deepening its partnership with state-owned enterprise FAW Group as it seeks to develop a leading position in the Chinese market for electric cars.

The VW   (VLKAY)  subsidiary also said that it has entered talks with another state-owned company, SAIC Motor, over another potential future partnership but did not elaborate.

The news follows a Reuters report over the weekend that suggested Audi faces a new investigation from U.S. authorities over emissions cheating devices that were found fitted to some of its cars.

VW stock was down by 1.4% in early European trading on Monday, to touch lows of €116.05 ($125). It has fallen by around 13%  so far this year.

Audi will add 10  electric models to the portfolio of FAW-Volkswagen, a joint venture between the German and Chinese companies.

Audi chairman Rupert Stadler said,  "Our e-tron offensive lays down a strong marker for the future...Audi and FAW have cooperated closely together for more than a quarter of a century. With our long-term growth strategy we will build upon this successful partnership."

VW has been a front runner in the race for dominance in the electric car market, with its 2025 strategy promising investors 30 models to choose from. In September VW announced that it is considering a joint venture with Anhui Jianghuai Automobile Group Co.

Reuters reported over the weekend that U.S. authorities have now begun an official investigation into software that the California Air Resources Board reportedly discovered in Audi cars earlier this year. The software was reportedly designed to detect when a vehicle is under test conditions and to then cheat the test.

VW has only just recently agreed a record settlement in the U.S. for the original emissions rigging scandal.

That scandal erupted in September last year, when VW was found to have fitted devices to the engines of its vehicles that were designed to defeat emissions testing software.

VW  agreed with U.S. authorities in June that it would spend close to $15 billion to settle the bulk of claims and liabilities in relation to the scandal, although investigations into some of its engines are still ongoing. The settlement received court approval in late October.  

More from Investing

Tesla Investor Pushing for More Board Changes

Tesla Investor Pushing for More Board Changes

What You Need to Know About Facebook and Europe's New Privacy Rules

What You Need to Know About Facebook and Europe's New Privacy Rules

8 Bold Moves General Motors Could Make to Rev Up Its Battered Stock Price

8 Bold Moves General Motors Could Make to Rev Up Its Battered Stock Price

Is Your Investment Portfolio Prepared for Trade Wars, Inflation and More Trump?

Is Your Investment Portfolio Prepared for Trade Wars, Inflation and More Trump?

Racing Legend Mario Andretti's Retirement Should Be Used as a Model for Retirees

Racing Legend Mario Andretti's Retirement Should Be Used as a Model for Retirees