USA: Dana and Dongfeng form Chinese truck axle joint venture
Dana Corp. on Thursday reportedly said it is investing $US60 million in China's largest vehicle axle manufacturer as part of a joint venture to make commercial auto axles in that country.
According to the Associated Press (AP), Toledo, Ohio-based Dana and Dongfeng Motor Co. said the 50/50 venture will employ about 8,000 workers at three plants and a research centre in Central China. The companies reportedly said they expect the collaboration to generate 2005 revenue of $400 million. The deal should be completed in the third quarter, pending government approvals and other conditions, AP added.
The companies reportedly said the Dongfeng Dana Axle Co. venture will primarily supply Dongfeng Motor, one of the world's largest truck producers, along with broadening its product offerings and customer base, mostly within China - the companies also said they may later add driveshafts and other commercial vehicle products.
According to AP, Dana said the operation will help it be globally competitive in the medium- and heavy-axle market while Dongfeng said it hopes the deal will expand its customer base.
Dana spokesman Gary Corrigan told the Associated Press the company has had operations in China for more than 30 years, though none near the size of the proposed partnership.
Dana currently operates an axle plant in Fuzhou and a driveshaft operation in Shenyang and, in December, sold an automotive filter operation in China, the report added.