Dongfeng to build light-vehicle engine venture

Shanghai, July 11 (Gasgoo.com) Dongfeng Automobile Co Ltd said on Friday that the company and its parent Dongfeng Motor Co have agreed to set up a joint venture specializing in light-vehicle engines. Total investment in the project will be 1.524 billion yuan ($222.6 million), according to a corporate statement in the Shanghai Securities News.

Dongfeng Auto will pay 367.2 million yuan for a 51% stake of the engine venture, which will have registered capital of 720 million yuan. Dongfeng Motor will invest its facility and equipment in this engine project, holding the remaining 49% share. The joint venture is expected to be set up in October, with production expected to start in March 2009.

The joint venture will mainly produce the Nissan ZD30 3L diesel engine and Dongfeng's self-developed light-vehicle engine. The Nissan ZD30 diesel engines to be made in the venture will meet the needs of Dengfeng LCVs (light commercial vehicles). These engines will also boost the Dongfeng Motor's engine-making technology in compliance with the future Chinese and Euro emission standards.

Meanwhile, Dongfeng Motor Co and Nissan Motor will jointly inject total capital of 1.04 billion yuan into their joint venture Zhengzhou Nissan in central China's Henan province, the Chinese company said in another statement.