Iveco, an affiliate of Italy's automaker Fiat, on Thursday launched a US$99.8 million joint venture in this city, after four year's negotiation with its Chinese partner Changzhou Changjiang Bus Co.
The 50-50 joint venture, the largest Sino-foreign bus manufacturing project, will assemble Iveco-brand large and medium-sized buses and will use Iveco's technology and parts to redesign the products of the Changjiang Bus Co.
According to Giancarlo Boschetti, chief executive officer of Iveco, the initial production capacity of the joint venture is 6,000 to 7,000 units a year.
The joint venture would adjust production according to changes on the market, Boschetti said.
"Demand for the large and medium-sized buses in China will increase significantly with extension of expressways and fast development of the southern and western regions of the country,'' Boschetti said at the launching ceremony of the joint venture.
To satisfy the demand, output of the buses is expected to grow at a rate of 13 per cent a year to 80,000 units by 2005, said sources from the State Economic and Trade Commission.
"We have already recognized increasing competition in the Chinese bus market, but we are confident we can build the joint venture into a market leader,'' he said.
Analysts say the joint venture's major competitors in China are those of Mercedes-Benz in Yangzhou, Jiangsu Province, Volvo in Xi'an, Shaanxi Province, and Daewoo Motors in Guilin in the Guangxi Zhuang Autonomous Region.
Iveco is the world's second biggest bus manufacturer, following only Mercedes-Benz.
Iveco also has a US$300 million joint venture in co-operation with the Nanjing-based Yuejin Automobile Group, producing Iveco commercial vans.
(www.chinadaily.com.cn 06/08/2001)
