Dongfeng, Schmitz Cargobull lay JV foundation stone

WUHAN – Dongfeng Motor Group (DFM) and Schmitz Cargobull AG started the construction of the new trailer plant in Wuhan on Nov 29, almost exactly a year after the two parties signed a joint venture contract, according to a company press release of Schmitz Cargobull.

The first semi-trailers for the Chinese market will roll off the assembly line in the second half of 2014. The joint venture company will invest more than 100 million euro?in the production facility in Wuhan over a period of five years.

Managers from Dongfeng and Schmitz Cargobull laid the foundation stone at a groundbreaking ceremony held on the site of the about-to-be-built new trailer plant, said the release.

A 30,000 square meters production facility will be built on the 150,000 square meters site. The plant, with an annual production capacity of up to 40,000 semi-trailers, is an important step for Schmitz Cargobull's expansion in China and Asia. 2,500 trailers are planned for the first year. The annual production shall increase to 20,000 semi-trailers over the course of the next three years, said the release.

Schmitz Cargobull has already developed a trailer for the Chinese market, which has undergone extensive testing at the Cargobull Validation Center and other locations.

"The use on unsealed roads is a day-to-day occurrence in China. Despite the regulations, overloading is a common occurrence. That is why the trailers have to be especially robust," explains Andreas Schmitz, member of the board of Schmitz Cargobull AG and CEO of the joint venture.

"The close cooperation and open attitude of the governmental authorities and industry have made it possible to complete the planning and preparatory work for the new production facility very quickly after signing the contract on Nov 16, 2012," says Andreas Schmitz.

Tong Dongcheng, vice-president of DFM, offered his congratulations on the kickoff of the construction. Tong says that partnering with Schmitz Cargobull is one of several significant steps that DFM has been taken to tap deeper into the medium- and heavy-duty truck industry. The future completion of the plant will definitely infuse powerful energy into DFM and the Chinese vehicle industry.

Dongfeng will handle the trailer sales, the customer service and other services, as the company possesses an extensive network of dealerships and service partners throughout China. The joint venture intends to utilize both the synergy effects and the growth potential and both partners have their sights set on a market of 300,000 units consisting of tractor units and trailers, said the release.