Volvo Agrees To Commercial Vehicle Joint Venture With Dongfeng - Report

Swedish truck maker Volvo has agreed to set up a commercial vehicle joint venture with Dongfeng Motor Group Co., the Economic Observer newspaper reported on its website, citing sources familiar with the situation.

According to the sources, Dongfeng would hold 55% of the joint venture, with Volvo holding the remaining 45%. The companies intend to establish the joint venture next year, the report said.

The plan would also see Nissan Motor, which has an existing relationship with Dongfeng to make commercial and passenger vehicles through a 50-50 joint venture, fully divest itself from the medium- and heavy-duty truck businesses in China, the report said. In return, Dongfeng would support the domestic production of Renault and Infiniti passenger cars, the report added.

Officials at the three companies couldn't be immediately available for comment.

Volvo's truck business, owned by AB Volvo, operates separately from Volvo Cars, which is owned by Zhejiang Geely Holding Group.

Newspaper website: http://www.eeo.com.cn/

-By China Bureau, Dow Jones Newswires; 8621 6120-1200; [e-mail]