Changan to acquire domestic diesel engine maker
China Changan Automobile Group Co. will complete the acquisition later this month of Yunnei Power Co., a state-owned diesel engine maker in the southwest China city of Kunming.
Under the agreement signed by Changan and the Kunming city government which owns Yunnei Power, Changan will invest 1 billion yuan ($152 million) in Yunnei Power over the next five years to strengthen its research and development capability.
Yunnei Power will develop and produce diesel engines for Changan. It also will be Changan's diesel engine exporter, said Yunnei Power in a statement.
Headquartered in Beijing, Changan is a major state-owned company. It owns three automakers: Chongqing Changan Automobile Co., Hafei Automobile Co. and Changhe Automobile Co. It also has joint ventures with Ford Motor Co., Suzuki Motor Corp. and PSA
Peugeot Citroen.
Listed on the Shanghai stock exchange, Yunnei Power can produce up to 500,000 diesel engines a year. Yunnei's diesels meet Euro IV emission standards, according to the company's Web site.
Yunnei Power currently supplies a wide range of domestic commercial vehicle manufacturers. It also supplies diesel engines for the passenger vehicles of Jianghuai Automobile Co. and Dongfeng Motor Corp.
