MTU, a subsidiary of Rolls-Royce, and China Yuchai International main operating subsidiary, Guangxi Yuchai Machinery Company (GYMCL), have agreed to set up a 50:50 joint venture for the production of MTU diesel engines in China.
Each party will invest RMB75 million (€10.43 million) in the joint venture.
The joint venture will be based at GYMCL’s primary manufacturing facilities in Yulin City in Guangxi Province, south China, and is expected to begin production in 2017.
The joint venture will produce MTU Series 4000 diesel engines compliant with China’s Tier 3 emission standards, with power outputs ranging from 1,400 to 3,490kW, primarily for the Chinese off-highway market, in particular for power generation and oil and gas applications.
MTU said the joint venture would open up new growth opportunities for both partners, particularly in China and elsewhere in Asia.