Volvo starts assembly of trucks in China
VOLVO STARTS ASSEMBLY OF TRUCKS IN CHINA Volvo Trucks has signed a Joint Venture agreement with China National Heavy Truck Corporation, CNHTC, for production of trucks. The registered capital in the joint venture company amounts to 600 million RMB, 60 MEUR, which is split equally between the two parties. Production is planned to commence by the end of this year. The market for heavy trucks in China has increased very fast. The strong economic growth and the massive investments in the Chinese infrastructure have been boosting the transport demand. The total market for heavy trucks above 16 tonnes is in the size of 50 000 today. This class is expected to grow to 80-100 000 trucks in six to seven years. The new company founded within the frame of the joint venture will be named Jinan Huawo Truck Co., Ltd with a 50/50% ownership between the two parties. Production will start by the end of 2003 in CNHTC's premises in Jinan, in the Shandong province. The initial capacity is 2000 trucks per year. Volvos product range in China will be Volvo FL, Volvo FM9 and Volvo FM12. The ambition is to increase volumes to 10 000 trucks per year by 2010 with a high level of local integration. "China is a key market for the Volvo Group and we have been working systematically to establish all our business areas in China. It is pleasant to certify that this joint venture makes Volvo Trucks the first western truck manufacturer with an industrial platform for heavy trucks in China", says Leif Johansson, President and CEO for the Volvo Group. CNHTC has a very strong foothold in China with a market leading position in the heavy truck segment (>20T) and an annual volume of 25000 units forecasted for 2003. Volvo Trucks first entered the Chinese market in 1991 with a market and service support organization. The development has been very strong with deliveries increasing to above 1000 trucks in 2002. "This agreement is an important milestone for Volvo Trucks. The Chinese market has a fantastic potential and CNHTC is a very strong partner. An industrial platform is essential for us to continue our growth in this dynamic market" says Jorma Halonen, President and CEO of Volvo Truck Corporation. June 9, 2003 For further questions, please contact Mårten Wikforss, Media Relations Volvo Group, +46 705 59 11 49 or Tommy Kohle, Volvo Truck Corporation,+46 706 76 65 17 ------------------------------------------------------------ This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: http://www.waymaker.net/bitonline/2003/06/09/20030609BIT00070/wkr0001.doc http://www.waymaker.net/bitonline/2003/06/09/20030609BIT00070/wkr0002.pdf