New Asian partner for Deutz

Engine manufacturer announces joint venture with Shandong Changlin Machinery Group

COLOGNE-based Deutz AG and Shandong Changlin Machinery Co. Ltd, a Chinese manufacturer of agricultural machinery and construction equipment, have signed an agreement to set up a joint venture for the production of engines.

The joint-venture firm, which will trade under the name of Deutz (Shandong) Engine Co. Ltd, will manufacture engines for the highly successful million-selling 2011 Series at the beginning of 2013. The engines are designed for use in agricultural machinery, construction equipment and industrial applications. By producing more of these engines with capacities of less than four litres, Deutz will significantly scale up their operations in China, along with the Deutz (Dalian) Engine Co. Ltd joint venture which has been manufacturing since 2007.

Deutz will hold a 70% stake in Deutz (Shandong) Engine, while Shandong Changlin Machinery Group will own the remaining 30%. The new plant based in Linyi, Shandong province, is expected to have an annual capacity of around 65,000 engines over the medium term.

‘The Chinese market offers us the greatest potential for growth in Asia,’ commented Dr Helmut Leube, chairman of Deutz board of management. ‘By starting to produce engines with capacities of less than four litres in China, we are therefore making a logical beneficial addition to our existing operations in a region where we have been building larger engines for many years.

‘The company has gained a reliable and experienced partner in Shandong Changlin Machinery Group. This publicly traded company has been manufacturing construction equipment and agricultural machinery for the past 30 years and is one of the organizations that have already benefited substantially from the stellar growth generated by this region to date.’