Isuzu Motors will become the first Japanese company to take a direct hit from General Motors’ bankruptcy as the American firm cuts its purchase of diesel engines from the Tokyo-based manufacturer, sources familiar with the matter have said.
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The development follows GM’s decision to pull the plug on medium-duty truck production, they told Kyodo News.
Isuzu has been supplying diesel engines to GM for the trucks from its plant in Tochigi Prefecture and a joint factory with GM in Ohio. In 2008, it shipped some 2,000 and 8,000 engines to GM from the Tochigi and Ohio plants respectively.
But GM’s decision to stop buying a yet-to-be-known number of diesel engines from Isuzu will have only a ”small impact” on the Japanese carmaker because the joint US plant now produces 70,000 engines a year, an Isuzu official told the news agency.
GM is also likely to review the procurement of medium-duty trucks Isuzu produces under the GM brand for the US market, the sources said.
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