Deutz AG, the engine manufacturing firm based in Cologne, Germany, has announced that it is expanding its operations in China through partnerships with three major local firms: Beinei, Horizon, and Sany. In a press release, the internal combustion engine maker said that China is the way to go for businesses in the engine industry, citing the country's high-growth figures.
Sany is China's biggest construction equipment company. In a memorandum of understanding signed in Beijing, Deutz will assume the role of majority shareholder with a 51 percent interest. It will supply Sany with some 75,000 brand new engines for different on and off-road projects in 2022, all of which are to be compliant with China 4 and 6 emissions standards. Lincoln Liang, a member of the Sany board of directors, said that they chose to partner with Deutz because it is one of the biggest engine makers in the world and shows plenty of promise for technological innovation.
The second partnership is with Beinei, which is setting up a new factory in Tianjin to produce some 20,000 engines. The Beinei and Deutz partnership will have the latter's management team to oversee the warehouse, which will serve as the production center to cater to the Asian market. The third agreement is with Horizon, a major player in the construction equipment rental industry with more than 80 branches. Horizon will be managing local operations in terms of field and aftermarket movements, writes KHL. It will also be a jump-off point for digital fleet services in the future.
Deutz is banking on this three-pillar growth strategy to generate some 500 million euros in revenue in China by 2022. It also hopes that this move will bring it closer to other Asian markets moving forward.
