Cargotec and CNHTC to set up Chinese joint venture
By Chris Sleight12 July 2012
Cargotec has announced plans to set up a 50:50 joint venture with China National Heavy Duty Truck Group Co., Ltd (CNHTC), a Chinese manufacturer of heavy duty trucks and the parent company of Sinotruk.
The joint venture will sell and service Cargotec range of Hiab cranes and hooklifts throughout China using CNHTC's dealer and service station network. There are also plans for the two companies to further develop CNHTC's existing truck crane range for the Chinese market.
Cargotec said that by combining the two companies' technical knowledge, it expected the joint venture to become a significant player in the truck crane sector in the near future, particularly in China. It added that China was the largest truck crane market in the world, with estimated sales last year of 35,000 machines.
"This joint venture represents an important strategic step for Cargotec, demonstrating our commitment to growing our offering and presence in China. Cargotec's strong existing range of load handling equipment, combined with CNHTC's leading position in the Chinese heavy truck market, will secure a fast and cost-effective channel for placing Hiab equipment in the hands of customers all over China," said Cargotec President and CEO Mikael Mäkinen.
Wei Zhihai, Vice President of CNHTC added, "Cargotec's long experience of technical innovations makes it the perfect partner for the joint development of a new truck crane range tailored to the needs of Chinese customers. Together, we expect to build world-class expertise with the purpose of securing a strong market position for truck cranes."
The transaction is subject to the relevant regulatory approvals, which are expected in the next six to nine months. Cargotec says it plans to invest € 100 million (US$ 125 million) in the joint venture over its life, with an initial equity investment of € 10 million (US$ 12.5 million).