Looking to expand in the world`s fastest-growing vehicle market, DaimlerChrysler said it will pay $104 million for a 24% stake in Chinese truck manufacturer Beiqi Foton Motor Co. becoming its second largest shareholder. The purchase must still get approval from Foton`s shareholders and the Chinese government.
DaimlerChrysler, the world`s No.5 carmaker and leading commercial truck supplier, already produces Mercedes-Benz luxury cars and other car models in a joint venture with Foton`s parent, Beijing Automotive Industry Holding, and has two other ventures in China, making multi-purpose vehicles and high-end buses.
"DaimlerChrysler now has a foot in the door of the local truck market, which has been growing at roughly 10 to 12% annually," said Zhang Xin, senior analyst at Guotai Junan Securities. DaimlerChrysler`s spokesman in China, Trevor Hale, said: "We have been in discussions with Foton for quite some time about cooperating to offer medium- and heavy-duty trucks in China." He declined to comment further on the company"s strategy.
China`s truck market is still dominated by domestic players. Sales of commercial vehicles - vans, buses and trucks - hit 1.5 million units in the first half of 2006, on track to beat last year`s total of 2.5 million.
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