AGCO To Build Engines in China?

Posted on July 29, 2011

In an interview with Bloomberg, AGCO Chairman and Chief Executive Officer Martin Richenhagen said the company will invest $300 million to $350 million over several years to design and manufacture tractors, and possibly diesel engines, in China.

Richenhagen said the investment will build a facility to assemble tractors with up to 125 hp, as well as components such as axles and engines. Components may be exported for tractor assembly in other countries, he said.

In a November, 2008 article in Diesel Progress International, Richenhagen and AGCO Sisu Power executives outlined plans to expand the company’s engine manufacturing footprint on a more global basis and cited Russia, China and South America as likely spots to expand.

Construction of the operations in China may begin in October and could begin production by the end of 2012, Richenhagen told Bloomberg. He said AGCO is acquiring land for the project, though he declined to disclose the location. AGCO’s board will vote on the project later this year, Bloomberg reported.