Cummins and Foton to build China's largest engine production base: report

BEIJING (AFP) - Top US diesel engine maker Cummins has tied up with China's Foton Motor to build the Asian nation's largest engine producer with an investment of 385 million dollars, state media said Thursday.

The 50-50 joint venture, formally launched on Wednesday in a suburb of Beijing, will have a capacity of 400,000 light diesel engines a year, the China Securities Journal reported.

Foton said it would install its engines in its high-end light trucks to help sell up to 200,000 units overseas in 2010.

Production of the 2.8-litre and 3.8-litre engines is expected to come online at the beginning of 2009, marking the first time the models are made outside the United States, Cummins said in a statement posted on its website.

The engines can also be sold to Cummins to supply auto makers in and outside China, it said.

The US company's sales in China topped 1.7 billion dollars last year, jumping 50 percent from 2006, it added.