New venture

Mumbai, Nov. 2: Mahindra & Mahindra today signed a deal with Navistar International to make diesel engines for medium and heavy commercial vehicles in India.

The deal is an extension of an earlier alliance struck in 2005 with International Truck and Engine Corporation, a unit of Navistar, to make medium and heavy commercial vehicles.

The joint venture, to be called Mahindra International Engines, will be 51 per cent owned by M&M and 49 per cent by Navistar.

Navistar is North America’s largest combined commercial truck, school bus and mid-range diesel engine producer. The combined investment of the two companies in the venture will be $90 million over the next five years.

According to M&M, from 2009, the new company’s advanced diesel engines will power the line of trucks and buses produced by the existing joint venture.

Engine components will be sourced locally, going up to 85 per cent within two years.

Anand Mahindra, vice- chairman and managing director of the Mahindra group, said, “This joint venture marks a significant milestone in M&M’s quest to emerge as a leading customer-centric organisation.”