According to a joint statement recently issued, Ford Motor Co. and Navistar International Corp. have officially formed a 50-50 joint venture — dubbed Blue Diamond Truck Co. LLC — to build commercial trucks for both companies to market. The new operation will also provide truck and diesel engine service parts to Ford and International, as well as “explore other advanced diesel engine opportunities.”
The OEMs said the venture will start out by building Class 6 and 7 (18,000-33,000 lb. GVW) medium trucks at a Navistar plant in Escobedo, Mexico. The trucks will be marketed separately under both the Ford name and Navistar's International nameplate.
In the future, said the truck builders, Blue Diamond will expand its truck offerings for both companies to include Class 3-5 (10,001 to 19,500 lb. GVW). However, no mention was made of Class 8 products — now or in the future.
Jack Allen, newly named general manager of Blue Diamond, said a new common chassis based on International's recently introduced High Performance chassis will be used for the medium-duty trucks. Cabs, interiors, nomenclature, “vocational focus” and other brand characteristics will be “maintained distinctly Ford or International.”
Allen said International-badged trucks will exclusively use International I-6 or V-8 engines, and Ford-badged trucks will offer International diesels along with other optional engines.
Prototype production of the Ford truck is slated to begin later this year with full production scheduled for late next year. The venture's first Class 3-5 truck is due in 2003. The OEMs said the vehicle will be a new specialized commercial truck, however, no further details will be available until the product is “market-ready.”
“In addition to expanding a strong business relationship between Ford and Navistar, this joint venture will increase the speed of new product development and improve economies of scale in manufacturing and parts procurement,” said Allen.
According to Ford and Navistar, both are contributing intellectual property to the venture. Navistar is also earmarking a major chunk of its Escobedo truck plant for the operation while Ford is making an undisclosed cash contribution to the venture. The OEMs stated that they have determined the joint venture does not require regulatory approval.
David W. Tarrant, manager of commercial truck strategy for Ford Motor Co., will serve as business and strategy director for Blue Diamond. “This partnership creates many new opportunities for both parent companies to better manage and participate in the worldwide commercial truck business,” he said. “We are looking at a number of exciting ideas which will be developed in the next several years.”
Each company will have equal representation on Blue Diamond's eight-member board and neither company will have an equity stake in the other's parent company. Dan Ustian, president of International Truck and Engine Corp.'s engine group, will serve as chairman of the executive board.