Ford and Navistar previously announced that they will end their diesel engine supply agreement. Navistar intends to cease operations at its Indianapolis complex on July 31.
“This is a difficult decision because of the impact it has on our employees and the community where we live and work,” said Eric Tech, vice president and general manager of Navistar Engine Group. “But the significant change in Ford’s business plans has forced us to make this decision.”
Navistar will continue to produce diesel engines for Ford through 2009. The companies will also continue to collaborate on a range of initiatives, including their existing Blue Diamond Truck and Parts joint ventures and their diesel engine supply agreement in South America.
“During the past 30 years, Ford and Navistar dominated the diesel-powered, heavy-duty pickup truck market, providing value to both companies’ customers and shareholders,” Tech said. “While this phase of our relationship will end, we look forward to continuing to work together through our existing joint ventures and South American partnership.”
Meanwhile, Navistar has continued to ensure the viability of its engine business through successful customer and product diversification efforts, including expansion projects in China and India.
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