Jianghuai Automobile's production line in China's eastern Anhui province. (File photo/CFP)
While Navistar, the largest truck and school bus maker in North America and the third largest truck engine maker in the United States, is shrinking its business in North America, the company plans on stepping up the investment in China, said Shanghai-based First Financial Daily.
Lewis Campbell, CEO of Navistar, said the company will cut down the cost of management and R&D, and will sell or close businesses in North America, leaving only its core operation of trucks and engines.
The CEO reportedly has announced to lay off 800 employees, which could save 28% in R&D costs, and has been considering shutting down 19 production lines in North America.
The joint venture between the company and Chinese Jianghuai Automobile in Anhui province was approved by the Chinese government in July.
The registered capital of the joint venture came to 1.2 billion yuan (US$191 million) with a total investment of 3 billion (US$479 million). The production line of the joint venture is expected to beging operation in 2013 and produce 150,000 engines each year.
An Jin, chairman of Jianghuai Automobile, said that the localization of engine production in the beginning will reach to 60% and the rate is expected to go to 100% in the future. The two companies will develop the overseas markets together, An said.
The joint venture will not just focus on China's market but a competitive alliance for the global market, with the truck production center in China as its base, said Wan Ruyi, CEO of Navistar China.
Jianghuai Automobile 江淮汽車
Liu Jinguo is deputy minister at China's Ministry of Public Security Liu was born in Changli county in Hebei province in 1955, Liu majored in economic administration at the Central Party School. ...