Deere & Co. is planning a $50 million facility in China to manufacture construction equipment, a company spokesperson said Tuesday.
"This will be our first wholly owned factory for construction equipment in China," Deere spokesman Ken Golden said. "We currently have a joint venture in construction equipment in China."
The new factory will produce four-wheel-drive loaders and excavators and will be located in the Tianjin Economic-Technological Development Area.
Overall, the new facility will be the sixth manufacturing location in China for Deere. Two of those are joint ventures, Golden said. Deere already has agriculture facilities in China.
"We'll be looking for preliminary manufacturing there in the summer of 2012," Golden said.
Jobs in the United States will not be affected by the new factory, he added.
"The products built in China are for China and targeted markets around that area," he said. "Products built in factories in the U.S. are specific for North American customers."
China's economy is growing, with infrastructure and new buildings going up, Golden said.
"It's the largest single construction equipment market in the world," he said.
"This new factory will enhance our opportunity to serve Chinese customers as well as customers in other markets," Samuel R. Allen, Deere chairman and CEO, said in a news release. "This action represents a meaningful expansion of Deere's construction equipment division in China."
Allen said in the news release that Deere's commitment to doing business in China dates back more than 30 years. Deere's long history in the country was mainly in the agricultural equipment sector until 2008, when the Moline-based manufacturer invested in a construction equipment joint venture to build excavators.
During Fiscal Year 2010, Deere invested in two new operations in India and expanded its reach in South America. In the fourth quarter, Deere broke ground on a new combine-harvester factory and announced a new joint-venture production facility for construction equipment - both in India. In October, Deere had its biggest month ever for tractor and combine sales in Brazil, where sales also are expected to benefit from a broader lineup of new model introductions.