DISCUSSIONS between Volvo Construction Equipment and Komatsu Ltd have reached basic agreement regarding co-operation in the production and development of construction equipment components. As a first step, the two companies have signed a letter of intent for the production of Komatsu-designed wheel loader cabs at Volvo’s cab plant in Hallsberg, Sweden.
The cabs in question, which are currently outsourced, will be for four models of Komatsu’s small wheel loaders, produced in Europe and North America. The production of around 1,500 units a year is scheduled to start at the beginning of 2003.
With the outsourcing of production to Volvo, Komatsu say they expect to realize a reduction in costs, while Volvo say they will benefit from increased operating efficiencies at their Hallsberg plant.
Other discussions currently in progress include talks on collaboration in the supply and development of drivelines, with the exception of engines. Conclusion of these discussions is expected to take place in the autumn.
In a joint statement, Masahiro Sakane, president of Komatsu Ltd, and Tony Helsham, president and CEO of Volvo Construction Equipment, said: ‘The cab venture is an initial step in our commitment to reinforce cost competitiveness, further improve quality and technology, and increase customer satisfaction.’
In all other respects, both companies will continue to engage in business as independent competitors using their own dealer networks, brands and product identities.