Navistar expects a new alliance with VW Truck & Bus to benefit its own truck and bus brands, International and IC Bus. Seen here is the Navistar Proving Grounds in Indiana.

Navistar expects a new alliance with VW Truck & Bus to benefit its own truck and bus brands, International and IC Bus. Seen here is the Navistar Proving Grounds in Indiana.

LISLE, Ill. — Navistar International Corp., parent company of school bus manufacturer IC Bus, has formed a wide-ranging strategic alliance with Volkswagen Truck & Bus, the companies announced on Tuesday.

Volkswagen Truck & Bus will take a 16.6% stake in Navistar, investing $256 million in the company and gaining the right to appoint two directors to Navistar's board.

The alliance also includes agreements for strategic technology and supply collaboration, as well as a procurement joint venture.

Navistar expects to be able to offer customers expanded access to products and services through collaboration on technology and the licensing and supply of Volkswagen Truck & Bus’ products and components, while better optimizing its product development spending. The alliance will reportedly also strengthen Navistar’s liquidity position.

The procurement joint venture is expected to leverage the purchasing power of Volkswagen Truck & Bus’ three major truck brands — Scania, MAN, and Volkswagen Caminhões e Ônibus — in addition to Navistar’s own International and IC Bus brands, providing Navistar with enhanced global scale.

“Starting in the near term, this alliance will benefit our purchasing operations through global scope and scale," said Troy Clarke, president and CEO of Navistar. "Over the longer term, it is intended to expand the technology options we are able to offer our customers by leveraging the best of both companies and enabling Navistar to deliver enhanced uptime.”

Andreas Renschler, CEO of Volkswagen Truck & Bus and a member of the board of management of Volkswagen AG, said that the strategic alliance with Navistar “is an important milestone and will be very beneficial for both sides.”

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