Dongfeng Cooperate with Volvo on Commercial Vehicles

Dongfeng Motor Corporation, one of China's largest commercial vehicle producers, said Tuesday it will cooperate with the world leading auto maker AB Volvo in making medium and heavy-duty commercial vehicles.

Sweden-based AB Volvo will invest in the medium and heavy-duty commercial vehicle and engine business of Dongfeng Motor, a joint venture owned by Dongfeng Motor Corp. and Japan-based Nissan Motor. The four companies have signed a framework agreement, Xinhua learned from Dongfeng Motor Corporation's Beijing office on Tuesday.

The non-binding agreement says Nissan Motor will focus on long-term cooperation with Dongfeng Motor Corp. in passenger vehicles and light-duty trucks.

Last March, Nissan Motor sold most of its 19 percent stake in Dongfeng Nissan Diesel Motor Co., which produces heavy-duty trucks, chassis and cement mixers, to AB Volvo for 1.5 billion kronor (US$210 million).

Dongfeng will forge competitive alliances with Nissan and Volvo to develop products that reflect each partner's specialist expertise, said the company.

As China's top producer of both medium and heavy-duty trucks, Dongfeng Motor was established in 2003 by Dongfeng Motor Corp. and Nissan Motor, who each have a half stake in the company.

AB Volvo is the world's second largest producer of heavy-duty commercial vehicles. Its products include trucks, buses, construction equipment, drive systems and aerospace components.

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