The year 2000 was not a good one for Mexican truck maker Consorcio G. Grupo Dina, S.A. de C.V. Dina lost $101.3 million last year, with $30.6 million of those losses coming in the fourth quarter of 2000 alone.
The losses are doubly bittersweet for Dina because 2000 started out on such a high note. The Mexican company had rosy export projections at the beginning of last year, based on a 10-year contract signed in September 1999 with Canadian truck maker Western Star Truck to build Class 6 and 7 vehicles – called the Solar Series -- for distribution in the United States, Canada and Australia.
However, Freightliner LLC, the heavy truck division of DaimlerChrysler, acquired Western Star for $453 million and cancelled the Solar Series contract. Currently, Dina is suing Freightliner and DaimlerChrysler for breach of contract. The lawsuit, filed with the International Arbitrage Court of the International Chamber of Commerce in Paris seeks $110 million in damages.
On top of that, the Mexican market for commercial vehicles for both domestic and export customers declined by about 15% to 49,747 units in 2000. Dina said its volume shrank by 6.6% from 2,286 units in the prior year to 2,135 units in 2000.