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Volvo to be biggest in heavy trucks with Dongfeng

Published on Jan 27, 2013 12:54 AM
 
President and chief executive of Sweden's Volvo Group Olof Persson gestures as he addresses a press conference in Bangalore on Nov 15, 2012. Sweden's Volvo said it will surpass Daimler as the world's biggest maker of heavy trucks after agreeing to set up a joint venture in China with Dongfeng Motor Group Co. -- PHOTO: AFP

BEIJING/STOCKHOLM (REUTERS) - Sweden's Volvo said it will surpass Daimler as the world's biggest maker of heavy trucks after agreeing to set up a joint venture (JV) in China with Dongfeng Motor Group Co.

Volvo will pay 5.6 billion yuan (S$1.1 billion) for a 45 per cent stake in the JV, giving it access to China where it currently has only a minor presence.

China was... "a little bit of a missing link in our global strategy for... Volvo trucks", Volvo chief executive Olof Persson said in a conference call with analysts and journalists. "With this agreement... we get a major foothold and share in the world's largest truck market."

The two firms will form a new venture called Dongfeng Commercial Vehicles after the Chinese firm buys Japan's Nissan Motor Co out from their joint venture in medium and heavy-duty trucks.

 
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