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Isuzu & GM to End Diesel Engine Partnership

December 22, 2010

DETROIT - Isuzu Motors Ltd. and General Motors Co. will end their partnership in diesel engine development, an area where the Detroit-based automaker now plans to go it alone, the Nikkei business daily reported.

"We won't be developing (engines) again with GM," the business daily quoted Isuzu President Susumu Hosoi as saying.

General Motors had not sounded out Isuzu about their next engine design, the paper said.

Isuzu will redirect the personnel and money it had dedicated to the joint venture to its own pipeline of trucks, which includes a low-priced model for emerging markets as well as a plug-in hybrid, the business daily said.

Isuzu and GM plan to continue engine production at joint ventures in the United States and Poland. However, Hosoi told the newspaper, "there is no point in working together if the technical alliance is gone," and eventually both companies need to rethink their engine-manufacturing tie-up, the daily said.

The Japanese firm plans to stop contracting pickup truck production from GM in Thailand next summer. Post that, remaining areas of cooperation will consist mainly of sales in Latin America and elsewhere, the Nikkei reported. Since 2006, when the two companies severed capital ties, both have been on increasingly divergent paths, the newspaper said.

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