Daimler to expand JV site in Romania to build transmission parts

Article by Anita Panait, on April 23, 2013

Daimler will invest a large amount to produce transmission parts in Romania, particularly at the Cugir plant of its existing joint venture in the country, according to a report from Handelsblatt. Citing sources privy to the carmaker, the daily said that Daimler's supervisory board will lay the groundwork for the investment on Wednesday.

Daimler is expanding its joint venture with the Romanian government since its transmissions production site in Untertuerkheim, Stuttgart, is nearing full capacity, Handelsblatt reported. In March, Romanian Prime Minister Victor Ponta disclosed that Romania had inked a memorandum of understanding with ''one of the biggest and most prestigious companies in Germany'' to open a production site in the country.

French carmaker Renault’s Dacia unit and American automaker Ford Motor Co. have car production sites in Romania. Carmakers from Western Europe are attracted to invest in Romania as the country’s low cost and skilled labor force enable them to incur lower manufacturing costs.

In 2008, Daimler was holding discussions with Romania to construct a Mercedes-Benz car plant in the country, but decided to invest EUR800 million in a site in Kecskemet, Hungary, where it currently produces the B class and CLA compact cars. Romanian media reported in 2012 that BMW was in talks with the city of Lugoj in Romania about building a production site.

Meanwhile, Daimler is launching three new compact models by 2015 alongside its A- and B-class cars as part of its bid to regain the crown as the best-selling luxury carmaker by the end of the decade. Daimler also unveiled on April 20, 2013 the Mercedes GLA compact crossover concept at the Shanghai auto show.

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