German diesel engine producer Deutz has licensed China's largest motor manufacturer First Automobile Works (FAW) to produce 80,000 to 100,000 engines a year at a new manufacturing facility to be built in Dalian, Liaoning province, Dow Jones reported. Part of the production may be sold back to Deutz for export to other markets in Asia. The production and export plan is the second phase of a 10-year technology co-operation and licensing agreement signed in October. In the first phase, Deutz is selling FAW engines for its 7- to 16-tonne trucks.
Deutz has been selling FAW engines for medium and heavy commercial vehicles for 10 years. It has also had co-operation agreements with Norinco and Machimpex since the 1970s and a manufacturing joint venture with Weifang Diesel Engine since 1997.