CNH Forms JV with Kamaz

After back in February German carmaker Daimler announced it has increased its stake in the Russian truck maker Kamaz, another joint venture has been established by the latter with Fiat-owned CNH International. The goal of the new partenrship is to manufacture agricultural and construction equipment in Russia, following the preliminary agreement signed in October 2009 by Sergio Marchionne.

"With this JV we aim to significantly increase our operations in Russia. We expect this alliance to foster improved local economic activity, through CNH's advanced technology, and increased, productivity in one of the world's most important markets," Franco Fusignani, CNH International CEO said in a release.

The new operation will be owned in equal amounts by CNH and Kamaz. It will be based in Naberezhnye Chelny, Kamaz's hometown. The production facility covers 50,000 square metres. Everything manufactured here will be at first used to satisfy the demand on the Russian market at first, expanding in later stages to most of the CIS countries.

CNH will provide Kamaz with certain New Holland models and technologies and will integrate the Naberezhnye Chelny plant into its global manufacturing network. Initially, the two sides will invest a total of $70 million, to satisfy a production capacity of 4,000 units a year.

“We have started realizing our common plans. The Russian users of agricultural and construction equipment will soon be able to purchase CNH’s high- quality and high-tech equipment produced at our JV in Russia,” Sergey Kogogin, General Director of OJSC Kamaz concluded.