Navistar To Halt Production Of Ford Diesel Engine

Says automaker is not honoring terms of contract.

Navistar International said Monday it is suspending production of the Power Stroke diesel engine it builds for Ford Motor because Ford has stopped honoring the terms of agreement under which the engines were built.

Navistar’s principal operating company, International Truck and Engine Corp., has been the exclusive diesel engine supplier for Ford’s heavy duty pickup trucks since 1979 and recently launched a new 6.4L Power Stroke diesel engine that meets 2007 emissions standards while increasing performance, durability and fuel economy.

International currently produces the new 6.4L Power Stroke diesel engine at its engine plants in Indianapolis, Ind., and Huntsville, Ala., and as a result of the dispute over commercial terms, production of those engines at both facilities will be halted immediately. The Huntsville operation will continue to produce engines for other customers.

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