Cento, Italy – General Motors has reached an agreement with GAZ Group, one of Russia’s largest car manufacturers, on a GAZ 50 per cent equity ownership in VM Motri S.p.A., a designer and manufacturer of diesel engines based in Cento, Italy.
GAZ Group is acquiring the equity stake under a purchase agreement with Penske Corporation, signed on August 27, 2008. GM purchased its 50 per cent equity share in VM Motori from Penske in 2007, after ten years of collaboration with the company in supplying engines for its Opel brand products, in a technology agreement with GM Daewoo, and in joint development of a new 2.9-litre V6 turbodiesel scheduled for the Cadillac CTS in Europe in 2009.
“This equity ownership agreement enables GAZ Group to access world-class diesel engine design and manufacturing,” said Sergey Zanozin, GAZ Group CEO. “It’s a highly promising investment opportunity, given the significant increase in demand for diesel engines in Russia and the positive business development of VM Motori globally.”
The agreements enable GAZ Group to set up production of VM Motori engines under license in Russia for its range of light commercial vehicles. Local production will also provide an opportunity to supply light diesel engines to Russian manufacturers of road construction and agricultural equipment.
“Diesel engines have a very important role in GM’s global advanced propulsion strategy,” said Mike Arcamone, vice-president, GM Powertrain Europe. “We are leveraging expertise and resources within our company and through technology partners like VM Motori to ensure we develop the world’s best powertrains. Our joint venture agreement with GAZ Group provides business opportunities to expand our diesel engine business with new customers.”