Volvo has entered into an agreement with Westport Innovations Inc as a Tier 1 Development Supplier for its heavy-duty natural gas engines and associated supply chain. Westport will supply its Westport HD technology and work together with the Gothenburg, Sweden, engine manufacturer to qualify appropriate suppliers consistent with Volvo volume and quality expectations. The new natural gas engines are expected to meet future European emission requirements.
In July 2008, Westport announced an agreement with Volvo to integrate and test Westport’s HD system on Volvo engines. Under the new agreements, Westport and Volvo will share program development expenses. The agreement requires Westport and Volvo to work to negotiate further agreements regarding certain elements of the development program. It also requires Westport and Volvo to satisfy certain milestones in order for the development program to continue, including completion of relevant technological, engineering, and cost requirements and completion of the further agreements.