Cummins and Beiqi Foton Motor Form Joint Venture to Produce High-Performance, Light-Duty Diesel Engines in China
19 October 2006
Cummins Inc. and Beijing-based Beiqi Foton Motor Company (Beiqi Foton) are forming a 50/50 joint venture company—Beijing Foton Cummins Engine Company Limited (BFCEC)—to produce two types of Cummins light-duty, high-performance diesel engines in Beijing.
The engines primarily will be used in light-duty commercial trucks, pickup trucks, multipurpose and sport utility vehicles. Certain types of marine, small construction equipment and industrial applications also will be served by this engine family.
Foton, founded in 1996, is the largest producer in the light-duty truck market in China, selling more than 260,000 units in 2005. The two partners initially will invest a combined $126 million into BFCEC.
The joint venture plant will have an annual capacity of 400,000 units and will produce Cummins 2.8-liter and 3.8-liter diesel engines, which will meet stringent on-highway and off-highway emission standards worldwide, including Euro 4 and above. BFCEC is scheduled to begin production in 2008.
The light-duty truck market in China produced 860,000 units in 2005 and is projected to grow at 8% a year for the foreseeable future.
Cummins began licensing its engine technology in China in 1981 and formed its first joint venture in the country in 1995. The company is the leading foreign producer of heavy-duty and mid-range diesel engines there.
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