and Navistar are to form a joint venture to build Class 6 and 7 medium commercial

The joint venture will also supply truck and diesel engine service parts to
Ford and International and “explore other advanced diesel engine opportunities”.

The newly-named Blue Diamond Truck Company LLC will initially produce medium
commercial trucks that will be marketed independently under the Ford and International

The trucks will be produced at Navistar’s plant in Escobedo, Mexico, and Blue
Diamond plans to expand the range for both companies.

Ford and Navistar are both contributing intellectual property to the joint
venture while Navistar is contributing a major portion of its Escobedo truck
manufacturing facility and Ford is making a cash contribution to the 50-50 joint
venture. No financial details are being released, however.

The general manager of the truck joint venture, Jack Allen, said a new common
chassis based on International’s recently introduced high performance chassis
will be used for commercial trucks (rated 18,000 to 33,000 pounds gross vehicle

He emphasised that the cabs, interiors, badging and other brand characteristics
will be kept distinctly Ford or International.

The International-branded trucks will exclusively use International’s
in-line 6 or V-8 engines but Ford versions will offer either International diesel
engines or other makes as options. International is claimed to be the worldwide
leader in the production of mid-range engines in the 160 to 300 horsepower range.

Prototype production of the Ford truck will begin later this year with full
production scheduled for late 2002. International’s new high performance medium
truck is already in production.

Initially the joint venture will produce Class 6 and 7 medium trucks, but plans
call for expanding output to include lighter weight Class 3 to 5 commercial
trucks (10,001 pounds to 19,500 pounds).

The first such vehicle will be a new specialised model due in 2003.

For competitive reasons, no other details will be revealed until products are
market-ready, Allen said.

“In addition to expanding a strong business relationship between Ford
and Navistar, this joint venture will increase the speed of new product development
and improve economies of scale in manufacturing and parts procurement,”
he added.

Ford’s manager of commercial truck strategy, David Tarrant, will serve
as the business and strategy director for Blue Diamond.

Another element of the joint venture is service parts support, led by Navistar’s
newly appointed general manager Tim Cooney who said that significant opportunities
exist to provide product support to customers of the new vehicles.

Each company will have equal representation on the venture’s eight-person executive
board, and neither company will have an equity stake in the other’s parent company.

The president of International Truck and Engine Corporation’s engine group,
Dan Ustian, will serve as chairman of the executive board.

To view related research reports, please follow
the links below:-

World Commercial Vehicles – Monthly analysis of developments in
global truck, bus and associated industries

North American Heavy Truck Market