China Yuchai announces hybrid engine projects

China Yuchai International Limited, announced that its subsidiary, Guangxi Yuchai Machinery Company Limited ("GYMCL"), is developing two new alternative energy diesel engines. One of them is a new dual fuel engine that utilizes a natural gas and diesel fuel mix which GYMCL is jointly developing with a Shenzhen-based company specializing in dual fuel technology. GYMCL is the first diesel engine manufacturer in China to successfully develop this type of dual natural gas and diesel mix engine.

The new natural gas/diesel engine allows for the engine to be electronically injected and to run on either a mixture of natural gas and diesel fuel or on diesel fuel only. The results of the combination are increased diesel fuel efficiency and lower emissions. It is specifically intended for areas with abundant natural gas supplies and is especially applicable to the municipal bus market in China.

The first phase of the development of the dual natural gas and diesel engine has been completed and initial units have been supplied to Zhengzhou Yutong Bus Co., Ltd (Shanghai Stock Exchange: 600066, or "Yutong"). Yutong is the largest and the most technically advanced manufacturing base for large and medium-sized buses around the world and is China's largest professional bus manufacturer with sales volume ranked second worldwide to that of Mercedes- Benz. The new engines are to be utilized in Yutong's 9-meter buses to be supplied to the Hainen Automobile Transportation Company.

The other alternative energy diesel engine is an ISG electric/diesel hybrid engine developed through GYMCL's internal research and development efforts. Development of an ISG electric/diesel engine began in 2006 and this is the first ISG electric/diesel engine to go into production and is expected to reduce fuel consumption by 20% with improved performance compared with standard diesel engines.

This new engine is an electronically controlled hybrid engine with both electric and diesel propulsion systems utilizing integrated starter/generator (ISG) technology which turns the engine off when the vehicle stops and instantaneously starts when the accelerator is pressed so that fuel is conserved when the vehicle is idling.

Mr. Zhang Zhihong, Deputy Director of the State Ministry of Science and Technology, and other ministry officials recently visited GYMCL's plant to inspect the ISG electric/diesel hybrid engine and expressed their support for GYMCL's development efforts towards energy conservation and environment protection. He commented that this development is an important milestone in China's ongoing efforts towards the adoption and use of environmentally-friendly, low-emission engines and automobiles.

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