Has Volvo plans to be a world leader?

Is Volvo planning to become Number One in world truck manufacture?

Volvo completes on Dongfeng

Volvo has completed the acquisition of 45 per cnet of Chinese truck manufacturer Dongfeng Commercial Vehicles (DFCV) in a deal worth 5.5 billion yuan (approximately £600 million).

Dongfeng to adopt CGI blocks and heads

Another of China’s diesel engine makers has chosen to adopt European diesel engine technology by going down the route of using compacted graphite iron (CGI) material for engine cylinder blocks and heads to increase engine performance.

Where now for Volvo and Dongfeng?

Observers are watching with interest, now that Volvo's 45 per cent stakeholding in Dongfeng Commercial Vehicles Co. Ltd. is official, to what extent the Swedish company will be able to influence senior executives in the Chinese truck maker, which has been in business since 1969.

The more so since Cummins Inc. of the US and Dongfeng have a 50-50 joint venture company, Dongfeng Cummins Engine Co. Ltd. Also Knorr-Bremse Commercial Vehicle Systems is expanding in China by taking a 51 per cent stake in Dongfeng Electronic & Technology Co. Ltd to make parts for commercial braking systems.

Volvo seeks slice of China

Volvo Corporation has paid about £570 million (about US$1 billion) for a 45 per cent stake in Dongfeng Commercial Vehicles Company (DCVC).

Dongfeng Motor Corporation (DMC) is already the largest producer of heavy-duty trucks in China while Volvo is the world’s third largest truck maker.

The market in China for such vehicles is said to be larger than the combined markets of the USA and Europe. China is reputed to account for 50 per cent of the world truck market.

Last year, the market for trucks in China totalled 636,000 for which Dongfeng is reputed to have taken a 16 per cent share. The medium-sized truck market accounted for some 290,000 units of which Dongfeng again accounted for 16 per cent.