NEW YORK (AP) -- Caterpillar Inc. said its Chinese subsidiary will join with a Chinese partner to create a company that will design and manufacture hydraulic pumps and motors for construction equipment.
Caterpillar said Sunday the venture with AVIC Liyuan Hydraulics Co. would boost its plans to expand machine capacity in China. AVIC makes hydraulic pumps and motors.
The new venture will make parts for products made by Caterpillar and other equipment manufacturers.
It would be Caterpillar's first joint venture for key components in China.
The joint company is expected to begin operations in China's Jiangsu province after getting government approvals.
Financial terms were not disclosed.
Caterpillar shares rose 49 cents to close at $80.24.
