Daimler sets up joint venture with Foton to make trucks

15:52, July 20, 2010      

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Beiqi Foton Motor Co. and Daimler AG held a joint venture signing ceremony on July 16 with Chinese Premier Wen Jiabao and German Chancellor Angela Merkel in attendance.

Foton made an announcement in January 2009 that its board had passed a resolution to set up a joint venture with Daimler Northeast Asia, Ltd. to produce medium and heavy trucks and engines.

According to the announcement, both sides will hold 50 percent share of the joint venture. Total investment is 6.35 billion yuan and registered capital is 5.6 billion yuan. The joint venture company is authorized to use the "Foton" trademark, original Foton Auman medium and heavy truck business-related strategic systems, IT systems and general technology.

Foton had expected the joint venture to be set up in August 2009 and start pilot production by the end of 2011, then vehicle production in 2012. However, the joint venture was not finally approved by the Chinese government until just recently.

Daimler Group currently has two joint ventures in China, namely a production joint venture with Beijing Automotive Group called Beijing-Benz as well as the Fujian Daimler Automotive Co., Ltd., which is a joint venture with Fujian Motor Group to produce light commercial vehicles. In the first half of 2010, Daimler Group's total sales in China reached 59,000 vehicles, an increase of 122 percent.

On May 27 of this year, Daimler Group signed an agreement with China's BYD Auto to invest 600 million yuan in a joint venture R & D company in China and plans to launch a new electric vehicle in 2013.

This time Daimler’s partner Foton is China's largest commercial vehicle seller. According to Foton, in the first half of 2010, Foton Motor vehicle sales were 370,000, an increase of 29.4 percent.

By Huang Beibei, People's Daily Online


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