Daimler to join forces with a Chinese manufacturer of trucks
January 8, 2009 – 11:15 pmDaimler plans to establish a joint venture worth $929 million from one of the largest Chinese manufacturers of trucks, the company Beiqi Foton, to produce heavy trucks in China, announced January 7, Financial Times.
50-50 joint venture with participation could still face with obstacles from regulators, analysts warn the car market, notes that two companies are discussing the possibility of several years. Last year, Beiqi Foton was unable to obtain permission from regulators to sell 24% of Daimler shares.
Press Secretary of the Chinese company said that the joint venture, which is scheduled to begin selling vehicles in 2012, intends to export about 20% of its products aimed at consumers of low-cost machines. According to estimates of analysts, by the middle of next decade, the production joint venture will reach 100 thousand units.
A joint venture would give Daimler a foothold in the Chinese sector of the trucks. However, the automotive consulting firm JD Power shows that the sector has suffered because of the Chinese economic slowdown. In November last year, sales of heavy trucks fell by 52% compared with the previous year.
Press Secretary Beiqi Foton said that the company predicts drop in sales of heavy trucks by 20% this year. According to analysts, the sector will recover, partly thanks to years of investment in infrastructure projects.
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