DAF Hikes Capacity at Eindhoven

DAF’s long-running capacity issues are to be addressed by the investment of €25 / £16.64 / $32.4 million in the Eindhoven plant, a move that will see daily capacity move from 180 to 300 units per day.A pattern is beginning to emerge here: not so long ago Volvo announced a hike in its Ghent plant’s capacity, and now DAF is doing the same. What are we to make of all of this in times of a falling market and more expensive money?

Iveco and Hyundai in China

News of a flurry of activity in China reaches us.

Fiat’s Chinese master plan now seems to be settling down a bit, with the news that Nanjing Iveco has been integrated with Yuejin. Yuejin will bear responsibility for light and heavy truck production, whilst Nanjing Iveco will manufacture light buses and forward control light trucks. Yuejin will share Nanjing Iveco's commercial vehicle technology. This deal makes Nanjing Iveco Fiat’s biggest Asian operation to date.According to the agreement, Fiat will invest RMB 400 (£26.49 / €39.38 / $51.58) million; Nanjing Automobiles will tip up a similar amount by throwing Yuejin's assets into the pot, and both parties will each hold a 50 per cent stake in the new Nanjing Iveco. When all is said and done, Nanjing Iveco will own two major product trucks and bus products giving effective coverage of the entire Chinese CV market. During 2007, the new operation is aiming for output of 100,000 units, with 25,000 bearing an Iveco badge, the remainder being branded with a Yuejin logo. More to the point, there is now open discussion about turning the Nanjing Iveco operation into a centre for Iveco exports to other markets.So far so good, but what are we to make of the news that Hyundai is about to give the finger to its South Korean workforce – which recently rejected a two-shift work system at the Jeonju plant - and is actively considering relocation of its CV business to China?In 2005 Hyundai Motor - formerly a best friend of DaimlerChrysler - signed an agreement with China’s Guangzhou Motor Group to establish a 50-50 joint venture company to make commercial vehicles in China. With a total investment of £220.86 / €331.83 / $430 million, the factory could have an annual production capacity of up to 200,000 units. Negotiations for the deal had stalled, but Hyundai sources report that the talks are back on and making swift progress.If this goes the distance, then the Guangzhou plant would be Hyundai Motor’s first large-scale overseas commercial vehicle plant. Hyundai has a factory to produce small commercial vehicles in Turkey, but its production capacity is low and it only assembles components sent from Korea. And we wonder if this could herald the start of a new, rather more international focus on the part of the South Korean OEM. Of course, the fact that its Chairman has just been banged up is unfortunate, but this could go somewhere interesting.