Beiqi Foton, Cummins Start JV Engine Project

The 400,000-unit joint venture diesel engine project between Beiqi Foton Motor Co., Ltd. and Cummins Inc.started production in Beijing on June 9, 2009.

The project will provide new-generation Cummins 2.8L and 3.8L light-duty diesel engines for Beiqi Foton to upgrade its products and speed up expansion in the global commercial car market.

The Chinese carmaker is approaching its goal of building the world's largest engine manufacturing base in Beijing with a production capacity of 1 million units, as it has had a 200,000-unit Ollin engine project and is planning to construct another 300,000-unit direct injection gasoline engine project.

In March 2008, Beiqi Foton and Cummins jointly established Beijing Foton Cummins Engine Co., Ltd. (BFCEC), commencing the construction of the 50-50 diesel engine project with a total investment of more than CNY 2.7 billion.

The US party injected its assets of 2.8L and 3.8L diesel engines into the venture, which meet the national Phase III and IV emission standards, or even higher emission standards, and can be widely used in light and medium-duty trucks, light-duty coaches, pick-up trucks, MPVs, SUVs, small engineering machinery, and small generator sets.

The engines produced by the venture will first be equipped on Beiqi Foton's Aumark light-duty trucks focusing on the domestic high-end and global markets, whose sales are expected to reach 10,000 vehicles this year.

Besides, the company's MP-X MPVs, Auman heavy-duty trucks, and AUV coaches will all be installed with Cummins engines, whose high emission standards and excellent power performance will make them more competitive in the overseas market.

As the largest domestic commercial vehicle producer, Beiqi Foton plans to sell 800,000 to 1 million complete vehicles next year, including 20% sold abroad. The day before, Beiqi Foton General Manager Wang Jinyu disclosed that its sales would reach 1.5 million vehicles by 2015, getting revenues of more than CNY 120 billion.

The same day, Beiqi Foton inked a technology license contract with Cummins, agreeing to team up in the development of engines meeting emission standards higher than the European union (Phase V) Emission Standards.

In May 2009, Beiqi Foton announced that a sales contract had been reached with Indian automobile manufacturer Ashok Leyland to supply the latter with 750 AUV coaches in completely knocked down kit form. The selling price reaches USD 22,500 apiece.

The Chinese party will deliver the buses within 150 days after the contract takes effect. By fulfilling the contract, Beiqi Foton will further promote AUV coaches in the overseas market.

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