Volvo to expand in China with $900m joint venture

Swedish carmaker Volvo (VOLVB.STO) has agreed to pay US$900 million for a 45% stake in a new truck manufacturing joint venture with Chinese Dongfeng Motor Group (0489.HKG), Reuters reported. The venture could help the Swedish manufacturer, which currently has only a minor presence in China, to overtake Daimler (DAI.FRA) as the world’s biggest maker of heavy trucks. The two firms plan to form Dongfeng Commercial Vehicles once Dongfeng buys Japan’s Nissan Motor (7201.TYO) out from their joint venture in medium and heavy-duty trucks. In 2011, Dongfeng, the world’s second largest producer of heavy-duty trucks, sold 186,000 vehicles, of which an estimated 142,000 were produced in the part of the company that will be included in the new joint venture.