Japanese truck maker Hino has announced it plans to shut down its Chinese diesel engine production subsidiary, known as Shanghai Hino Engine Company, after more than 20 years of operation, with the company blaiming deteriorating market conditions.
Shanghai Hino, has been a joint venture, which was 70 per cent owned by Hino Motors and 30 per cent held by state owned Guangzhou Automobile Group, and it was established in 2003, to produce diesel engines for local commercial vehicle and construction machinery manufacturers.
In addition to the decision by the board at Hino, Shanghai Hino also passed a resolution that the company will be disbanded.
Shanghai Hino chiefly manufactured and marketed engines for commercial vehicles and construction machinery primarily for the China market.However it is believed that issues with Hino’s Poncho bus, which saw it withdrawn from sale in Australia and production stopped in China may have been linked to the Shanghai engine plant.
According to a Hino press release, the decision to disband the company comes after the board concluded that it was unlikely that Shanghai Hino would grow in a sustainable manner, mainly because the growth in EV vehicles and construction machinery in China.
For its part, Shanghai Hino said the decision to halt production was due to ‘the overall market environment’, with production at plant set to cease in the next two weeks at end of September.